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2021, 05-18 Study Session AGENDA SPOKANE VALLEYCITY COUNCIL REGULARMEETING STUDY SESSION FORMAT Tuesday,May 18,20216:00 p.m. Remotely via ZOOM Meeting 10210E Sprague Avenue Council Requests Please Silence Your Cell Phones DuringCouncil Meeting NOTE:In response to Governor Inslee's March 24, 2020 Proclamation concerning the COVID-19 Emergency, which waives and suspends the requirement to hold in-person meetings and provides options for the public to attend remotely, physical public attendance at Spokane Valley Council meetings are suspended until the Governor's order has been rescinded or amended. Therefore, until further notice, a live feed of the meeting will be available on our website and on Comcast channel 14. Public comments will only be accepted for those items noted on the agenda as “public comment opportunity,”will be accepted via the following links, and must be received by 4:00 pm the day of themeeting. Sign up to Provide Oral Public Comment at the Meeting via Calling-In Submit Written Public Comment Prior to the Meeting Join the Zoom WEB Meeting ------------------------------------------------------------------------------------------------------------------------------- CALL TO ORDER ROLL CALL APPROVAL OF AGENDA ACTION ITEMS: 1. PUBLIC HEARING: 2021Budget Amendment –Chelsie Taylor \[public commentopportunity\] 2.First Reading Ordinance 21-006 Amending 2021 Budget –Chelsie Taylor \[no public commentopportunity\] 3. Motion Consideration: Proposed Land Acquisition, Ponderosa Property –Cary Driskell \[public comment opportunity\] 4. Motion Consideration: Proposed Land Acquisition, Flora Rd & Montgomery Ave –Bill Helbig \[public comment opportunity\] 5. Motion Consideration: Bid Award, Evergreen Preservation –Bill Helbig \[public comment opportunity\] ------------------------------------------------------------------------------------------------------------------------------- NON-ACTION ITEMS: DISCUSSION LEADERSUBJECT/ACTIVITY___ GOAL__________ 6. Adam Jackson Draft 2022-2027 Six Year Discussion/Information Transportation Improvement Program 7. Chaz Bates Housing Action Plan Discussion/Information 8. John Bottelli, Carol Carter,Events, Activities and RecreationDiscussion/Information Patty Bischoff, Tina GregersonIn Phase 3 Covid-19 9.Mayor Wick Advance Agenda Discussion/Information 10. Information Only (willnot be reported or discussed):Spokane Regional Law & Justice Council Report 11. Mayor Wick Council CommentsDiscussion/Information 12. Mark Calhoun City Manager CommentsDiscussion/Information ADJOURN Council Agenda May 18, 2021Page 1of 1 CITY OF SPOKANE VALLEY Request for Council Action Meeting Date:May18, 2021 Department Director Approval: Check all that apply:consent old business new business public hearing informationadmin. reportpending legislationexecutive session AGENDA ITEM TITLE:Public Hearing on the proposed 2021BudgetAmendment. GOVERNING LEGISLATION:In order for the City to amend an adopted budget,State law requires the Council to approve an ordinancethat appropriates additional funds. PREVIOUS COUNCIL ACTION TAKEN:The Council last took formal action on the 2021 Budget when it was adopted on December8, 2020.On May 4, 2021an Administrative Report was delivered to Councilregarding the need for a budget amendment. BACKGROUND:Since the initial adoption of the 2021 Budget on December 8, 2020,a number of events have transpired in the normal course of operations that necessitate a 2021 Budget amendment. The proposed budget amendments include: #001-General Fund The total of both recurring and nonrecurring revenues reflect an increase of $3,286,800, which is comprised of: Sales taxes are increased to the amount of actual collections in 2020: $2,980,000 increase in general sales tax collections due to current economic conditions. $105,200 increase in public safety sales tax collections due to current economic conditions. $177,600 increase in criminal justice sales tax collections due to current economic conditions. $24,000 increase for an estimated FEMA grant for costs related to a windstorm in January 2021. Provide additional appropriations (expenditures) of $12,769,313comprised of: $7,106 increase in benefits costs for the City Council Department related to providing pension benefits to councilmembers. $5,750 increase in software licenses and maintenance costs related to paying for six months of service on the GovQA public records software system. $391,754 increase in Public Safety for estimated 2021 costs related to implementing a new DEMS/Taser/Body Camera bundle for the Police Department. This represents the City’s share of the upfront costs for the system, and consists of $282,146 in recurring expenditures rd and$109,608 in nonrecurring expenditures. Council discussed this cost at the March 23 th and April 6Council meetings. $72,508 increase in salaries and related payroll taxes and benefits in the City Hall O&M Department and a corresponding decrease of the same amountin the Building Department due to repurposing an existing position due to workload. $51,299increase in the Economic Development Divisionfor the in-house GIS Analyst position. This amount includes $46,299in salaries and related payroll taxes and benefits and $5,000 in supplies, training, and memberships for that position. The salaries, payroll taxes, and benefits are included for six months at 77% in the General Fund and 23% in the Stormwater Fund #402. 1 $1,040 decreasein professional services for the Parks and Recreation Admin Division. There is a corresponding increase of $1,040 in the nonrecurring transfers out to the Parks Capital Projects Fund #309 for fencing costs to completethe CenterPlace West Lawn improvement project in order to finish securing the area. $5,000 increase for furniture for the new Housing and Homeless Services Coordinator position. This was included but not spent in the 2020Budget. $62,000 increase to replace the HVAC units at the Precinct. There was $60,000 included but not spentin the 2020 Budget for this item. The increase represents the actual costs for this project. $32,000 increase for cleanup costs from a January 2021 windstorm. We are anticipating a FEMA grant to reimburse 75% of these costs. $693,000 increase in transfers out to the Street O&M Fund #101 to cover an increase in the estimated operating deficit caused by the anticipated decrease in fuel taxes and telephone utility taxes from the effects of the COVID-19 pandemic on the economy. $364,440 to replenish the Winter Weather Reserve Fund #122 back to a fund balance of $500,000. The Street O&M Fund was over budget on snow removal expenditures in 2020 by about $364,440. $14,876 increase in transfers to the Parks Capital Projects Fund #309 for the CenterPlace west lawn improvements. This includes an additional $1,040 that is being reduced out of the Parks and Recreation Admin Division for additional fencing costs as described above as well as $13,836 of the previously approved amount from the 2020 Budget to complete the project in 2021. $12,227 increase in transfers to the Parks Capital Projects Fund #309 for the CenterPlace roof replacement for work that was included in the 2020 Budget but was not able to be completed prior to the end of the year. $11,126,343 transferred to Capital Reserve Fund #312 which represents the 2019 yearend fund balance in excess of 50% of recurring expenditures. #101–Street O&MFund Revenues have a netchange of $0; however, recurring revenues are estimated to decrease by $693,000 due to the effects of the COVID-19 pandemic on the economy. The decrease is comprised of $431,000 in the telephone utility tax and $262,000 in motor vehicle fuel taxes. The estimated deficit of $693,000 in operating activity caused by this decrease is then proposed to be covered by a transfer in from the General Fund in the same amount. #122–Winter Weather Reserve Fund Revenues are increased by $364,440 reflecting a transferin from the General Fund #001 to replenish the fund balance to $500,000. The Street O&M Fund was over budget on snow removal expenditures in 2020 by about $364,440, which was reimbursed to Fund #101 from Fund #122 during that year. #309–Park Capital Projects Fund This fund is being amended to reflect current estimates on a number of projects. Revenues are increased by $224,691reflecting: $44,730 increase in grant proceeds for the Browns Park 2020 improvements. The increase is related to the timing of actual construction on the project. $27,103 increase in transfers in from the General Fund for improvements to the CenterPlace west lawn and the replacement of the CenterPlace roof. See additional information above under the General Fund #001. $152,858 increase in transfers in from the Capital Reserve Fund #312 for the Sullivan Park water line project. 2 Expenditures increase by $384,887, including: An increase of $14,876 to complete the improvements to the CenterPlace west lawn. See additional information above under the General Fund #001. An increase of $12,227 to complete the replacement of the CenterPlace roof. See additional information above under the General Fund #001. An increase of $204,926 for Browns Park 2020 improvements. This increase trues up the costs to the actual bid awarded for the project. There is sufficient fund balance to account for the increased costs. An increase of $152,858 for preliminary engineering costs for the Sullivan Park water line project. #312–Capital Reserve Fund Revenues are increased due to a transfer of $11,126,343 from General Fund #001 which represents the 2019 yearend fund balance in excess of 50% of recurring expenditures.This amount is higher than we generally see because the City did not transfer the 2018yearend fund balance in excess of 50% due to the uncertainty of the economy during 2020 with the COVID-19 pandemic. As such, the 2018 amounts remained in the fund balance and were included in the calculation for the 2019 fund balance. Increases expenditures/appropriations of $2,052,858, including $152,858 in transfers out to the Parks Capital Projects Fund #309 for the Sullivan Park water line project.There is also $1,900,000 proposed for land acquisition with $300,000 for land at Flora and Montgomery for a future trailhead and $1,600,000 for Ponderosa parkland. #402–Stormwater Management Fund Provide additional appropriations (expenditures) of $13,830for salaries, payroll taxes, and benefits for the in-house GIS Analyst position. The salaries, payroll taxes, and benefits are included for six months at 77% in the Economic Development Division in the General Fund and 23% in the Stormwater Fund #402. The 2021 Budget amendment reflects the changes noted above and will affect 6 funds resulting in total revenue increases of $15,002,274 and expenditure increases of $15,216,330. RevenueExpenditure FundFundIncreaseIncrease No.Name(Decrease)(Decrease) 001General Fund3,286,80012,764,755 101Street O&M Fund00 122Winter Weather Reserve Fund364,4400 309Parks Capital Projects Fund224,691384,887 312Capital Reserve Fund11,126,3432,052,858 402Storwater Management Fund013,830 15,002,27415,216,330 The 2021 Budget amendment also includes one change to the Employee PositionClassification Monthly Salary Schedule to add the GIS Analyst position. This additional position will add 1 FTE bringing the total FTEs to 96.25 from 95.25. This FTE will be split 0.77 to the General Fund and 0.23 to the Stormwater Fund #402. 3 OPTIONS:Future options are to accept the proposed amendments in whole or in-part. RECOMMENDED ACTION OR MOTION:The purpose of this evening’s public hearing is to consider input from the public on the proposed budget amendment and no action is requiredof Council at this time. A first reading of Ordinance #21-006 is scheduled immediately after the public hearing. Anticipated future actionby the Council includes: May25, 2021–Second reading of Ordinance #21-006amending the 2021 Budget. BUDGET/FINANCIAL IMPACTS:This action amends the estimated revenues and appropriations for the 2021 Budget that was adopted on December 8, 2020. There are adequate funds available to pay for these amendments. STAFF CONTACT:Chelsie Taylor, Finance Director ___________________________________________________________________________ ATTACHMENTS: Fund level line-item detail of revenues and expenditures. Fund summaries for all funds affected by the proposed budget amendment. Proposed amended Employee Position Classification Monthly Salary Schedule. 4 (h/m tax-CP advertising) (2016 LTGO debt service) (park capital projects) (pavement preservation) (CenterPlace kitchen reserve) (insurance premium) (office furniture for Housing Serv emplo (replace HVAC units at Precinct) (replace handguns) (radar trailer) (Precinct access control gate) (Precinct fire panel replacement) (DEMS/Tasers/BodyCams) (Ecology SMP Update) (Street Fund operations) (replenish reserve) (CenterPlace west lawn) (CenterPlace roof repairs) ('19 fund bal >50%) Fund balance as a percent of recurring expenditures90.33%68.79% (non-plow vehicle rental) (plow replace.) ('19 fund bal >50%) (Balfour Park frontage improvem (Sullivan Park water line) (Pines Rd Underpass) (Barker Rd Overpass) (Sullivan Rd Interchange) Note: Slight rounding differences may exist between the figures reflected on this page and the actual payroll rates computed by the Eden Payroll System. CITY OF SPOKANE VALLEY Request for Council Action Meeting Date:May18, 2021 Department Director Approval: Check all that apply:consent old business new business public hearing informationadmin. reportpending legislationexecutive session AGENDA ITEM TITLE:First reading of proposed Ordinance #21-006which amends the 2021 Budget. GOVERNING LEGISLATION:In order for the City to amend an adopted budget,State law requires the Council to approve an ordinancethat appropriates additional funds. PREVIOUS COUNCIL ACTION TAKEN:The Council last took formal action on the 2021 Budget when it was adopted on December8, 2020.On May 4, 2021,an Administrative Report was delivered to Council regarding the need for a budget amendment. Finally, earlier this evening a public hearing was held on this topic. BACKGROUND:Since the initial adoption of the 2021 Budget on December 8, 2020, a number of events have transpired in the normal course of operations that necessitate a 2021 Budget amendment. The proposed amendments include: #001-General Fund The total of both recurring and nonrecurring revenues reflect an increase of $3,286,800, which is comprised of: Sales taxes are increased to the amount of actual collections in 2020: $2,980,000 increase in general sales tax collections due to current economic conditions. $105,200 increase in public safety sales tax collections due to current economic conditions. $177,600 increase in criminal justice sales tax collections due to current economic conditions. $24,000 increase for an estimated FEMA grant for costs related to a windstorm in January 2021. Provide additional appropriations (expenditures) of $12,769,313comprised of: $7,106 increase in benefits costs for the City Council Department related to providing pension benefits to councilmembers. $5,750 increase in software licenses and maintenance costs related to paying for six months of service on the GovQA public records software system. $391,754 increase in Public Safety for estimated 2021 costs related to implementing a new DEMS/Taser/Body Camera bundle for the Police Department. This represents the City’s share of the upfront costs for the system, and consists of $282,146 in recurring expenditures rd and$109,608 in nonrecurring expenditures. Council discussed this cost at the March 23 th and April 6Council meetings. $72,508 increase in salaries and related payroll taxes and benefits in the City Hall O&M Department and a corresponding decrease of the same amountin the Building Department due to repurposing an existing position due to workload. $51,299increase in the Economic Development Divisionfor the in-house GIS Analyst position. This amount includes $46,299in salaries and related payroll taxes and benefits and $5,000 in supplies, training, and memberships for that position. The salaries, payroll 1 taxes, and benefits are included for six months at 77% in the General Fund and 23% in the Stormwater Fund #402. $1,040 decreasein professional services for the Parks and Recreation Admin Division. There is a corresponding increase of $1,040 in the nonrecurring transfers out to the Parks Capital Projects Fund #309 for fencing costs to completethe CenterPlace West Lawn improvement project in order to finish securing the area. $5,000 increase for furniture for the new Housing and Homeless Services Coordinator position. This was included butnot spent in the 2020Budget. $62,000 increase to replace the HVAC units at the Precinct. There was $60,000 included but not spentin the 2020 Budget for this item. The increase represents the actual costs for this project. $32,000 increase for cleanup costs from a January 2021 windstorm. We are anticipating a FEMA grant to reimburse 75% of these costs. $693,000 increase in transfers out to the Street O&M Fund #101 to cover an increase in the estimated operating deficit caused by the anticipated decrease in fuel taxes and telephone utility taxes from the effects of the COVID-19 pandemic on the economy. $364,440 to replenish the Winter Weather Reserve Fund #122 back to a fund balance of $500,000. The Street O&M Fund was over budget on snow removal expenditures in 2020 by about $364,440. $14,876 increase in transfers to the Parks Capital Projects Fund #309 for the CenterPlace west lawn improvements. This includes an additional $1,040 that is being reduced out of the Parks and Recreation Admin Division for additional fencing costs as described above as well as $13,836 of the previously approved amount from the 2020 Budget to complete the project in 2021. $12,227 increase in transfers to the Parks Capital Projects Fund #309 for the CenterPlace roof replacement for work that was included in the 2020 Budget but was not able to be completed prior to the end of the year. $11,126,343 transferred to Capital Reserve Fund #312 which represents the 2019 yearend fund balance in excess of 50% of recurring expenditures. #101–Street O&MFund Revenues have a net change of $0; however, recurring revenues are estimated to decrease by $693,000 due to the effects of the COVID-19 pandemic on the economy. The decrease is comprised of $431,000 in the telephone utility tax and $262,000 in motor vehicle fuel taxes. The estimated deficit of $693,000 in operating activity caused by this decrease is then proposed to be covered by a transfer in from the General Fund in the same amount. #122–Winter Weather Reserve Fund Revenues are increased by $364,440 reflecting a transfer in from the General Fund #001 to replenish the fund balance to $500,000. The Street O&M Fund was over budget on snow removal expenditures in 2020 by about $364,440, which was reimbursed to Fund #101 from Fund #122during that year. #309–Park Capital Projects Fund This fund is being amended to reflect current estimates on a number of projects. Revenues are increased by $224,691reflecting: $44,730 increase in grant proceeds for the Browns Park 2020 improvements. The increase is related to the timing of actual construction on the project. $27,103 increase in transfers in from the General Fund for improvements to the CenterPlace west lawn and the replacement of the CenterPlace roof. See additional information above under the General Fund #001. 2 $152,858 increase in transfers in from the Capital Reserve Fund #312 for the Sullivan Park water line project. Expenditures increase by $384,887, including: An increase of $14,876 to complete the improvements to the CenterPlace west lawn. See additional information above under the General Fund #001. An increase of $12,227 to complete the replacement of the CenterPlace roof. See additional information above under the General Fund #001. An increase of $204,926 for Browns Park 2020 improvements. This increase trues up the costs to the actual bid awarded for the project. There is sufficient fund balance to account for the increased costs. An increase of $152,858 for preliminary engineering costs for the Sullivan Park water line project. #312–Capital Reserve Fund Revenues are increased due to a transfer of $11,126,343 from General Fund #001 which represents the 2019 yearend fund balance in excess of 50% of recurring expenditures.This amount is higher than we generally see becausethe City did not transfer the 2018 yearend fund balance in excess of 50% due to the uncertainty of the economy during 2020 with the COVID-19 pandemic. As such, the 2018 amounts remained in the fund balance and were included in the calculation for the 2019fund balance. Increases expenditures/appropriations of $2,052,858, including $152,858 in transfers out to the Parks Capital Projects Fund #309 for the Sullivan Park water line project.There is also $1,900,000 proposed for land acquisition with $300,000 for land at Flora and Montgomery for a future trailhead and $1,600,000 for Ponderosa parkland. #402–Stormwater Management Fund Provide additional appropriations (expenditures) of $13,830for salaries, payroll taxes, and benefits for the in-house GIS Analyst position. The salaries, payroll taxes, and benefits are included for six months at 77% in the Economic Development Division in the General Fund and 23% in the Stormwater Fund #402. The 2021 Budget amendment reflects the changes noted above and will affect 6 funds resulting in total revenue increases of $15,002,274 and expenditure increases of $15,216,330. RevenueExpenditure FundFundIncreaseIncrease No.Name(Decrease)(Decrease) 001General Fund3,286,80012,764,755 101Street O&M Fund00 122Winter Weather Reserve Fund364,4400 309Parks Capital Projects Fund224,691384,887 312Capital Reserve Fund11,126,3432,052,858 402Storwater Management Fund013,830 15,002,27415,216,330 The 2021 Budget amendment also includes one change to the Employee PositionClassification Monthly Salary Schedule to add the GIS Analyst position.This additional position will add 1 FTE 3 bringing the total FTEs to 96.25 from 95.25. This FTE will be split 0.77 to the General Fund and 0.23 to the Stormwater Fund #402. OPTIONS:Options are to accept the proposed amendments in whole or in-part. RECOMMENDED ACTION OR MOTION:Move to advance Ordinance #21-006amending the 2021Budget to a second reading. BUDGET/FINANCIAL IMPACTS:This action amends the estimated revenues and appropriations for the 2021 Budget that was adopted on December 8, 2020. There are adequate funds available to pay for these amendments. STAFF CONTACT:Chelsie Taylor, Finance Director ATTACHMENTS:Draft Ordinance#21-006 4 DRAFT CITY OF SPOKANE VALLEY SPOKANE COUNTY, WASHINGTON ORDINANCENO. 21-006 ANORDINANCE OF THE CITY OF SPOKANE VALLEY, SPOKANECOUNTY, WASHINGTON, AMENDING ORDINANCE 20-023,WHICH ADOPTEDA BUDGET FOR THE PERIOD JANUARY 1, 2021THROUGH DECEMBER 31, 2021;AND OTHER MATTERS RELATED THERETO. WHEREAS, the City Council approvedOrdinance 20-023onDecember 8, 2020, which adopted the 2021annual budget;and WHEREAS,subsequent to the December 8, 2020adoption of the2021 annual budget, it has become necessary to make changes by adding new revenue,appropriations, amendments, and transferring funds in order to properly perform City functions, services and activities; and WHEREAS,certain changes to employee positions have been made by the City Manager, which necessitate changes to the Employee Position Classification Monthly Salary Schedule that was included in the 2021 annual budget; and WHEREAS,the budget changes set forth in this Ordinancecould not have been reasonably anticipatedor known when the 2021annual budget was passed by the City Council; and WHEREAS,the City Council has determined that the best interests of the City are served by amending the2021budget to reflect unanticipated revenue, expenditures, transfers,and appropriating the same as set forth herein. NOW THEREFORE, the City Council of the City of Spokane Valley, Washington do ordain as follows: Section 1.Amended Revenuesand Appropriations.Ordinance No. 20-023adopteda budget for the twelve monthsbeginning January 1, 2021andending December 31,2021. Each item, revenue, appropriation, and fundcontained in Section 1of Ordinance 20-023ishereby further amended as set forth in AttachmentAto this Ordinance, which is incorporated herein. Section 2.Amended Employee Position Classification Monthly Salary Schedule.Ordinance No. 20-023adopted an Employee Position Classification Monthly Salary Schedule as part of the budget forthe twelve months beginning January 1, 2021 and ending December 31, 2021. The schedule is hereby amended as set forth in Attachment B to this Ordinance, which is incorporated herein. Section 3.Severability.If any section, sentence, clause or phrase of this Ordinance should be held to be invalid or unconstitutional by a court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity or constitutionality of any other section, sentence, clause or phrase of this Ordinance. Section 4.Effective Date.This Ordinance shall be in full force and effect five days after publication of this Ordinance or a summary thereof in the official newspaper of the City as provided by law. Ordinance 21-006amending the 2021budgetPage 1of 4 Passed by the City Council of the City of Spokane Valley this ____ day of May 2021. ATTEST: Ben Wick, Mayor ___________________________ Christine Bainbridge, City Clerk Approved as to form: __________________________ Office of the City Attorney Date of Publication: ___________ Effective Date: _______________ Ordinance 21-006amending the 2021budgetPage 2of 4 4 of 3 Page A ATTACHMENT budget 2021 amending the 006 - 21 Ordinance ATTACHMENT B EMPLOYEE POSITION CLASSIFICATION MONTHLY SALARY SCHEDULE Effective January 1, 2021 Position TitleGrade2021 Range City ManagerUnclassified Deputy City Manager2210,063.44 -16,365.38 City Attorney219,066.16 -14,728.96 Finance Director219,066.16 -14,728.96 Parks and Recreation Director208,159.44 -13,257.04 City Engineer197,343.36 -11,931.46 Deputy City Attorney197,343.36 -11,931.46 Human Resources Manager197,343.36 -11,931.46 Planning Manager186,609.87 -10,737.79 Building Official186,609.87 -10,737.79 Engineering Manager186,609.87 -10,737.79 Economic Development Manager186,609.87 -10,737.79 Senior Engineer 175,948.55 -9,663.61 Accounting Manager175,948.55 -9,663.61 Assistant Building Official175,948.55 -9,663.61 Public Works Superintendent175,948.55 -9,663.61 Senior Administrative Analyst175,948.55 -9,663.61 IT Manager175,948.55 -9,663.61 Attorney165,353.16 -8,696.69 City Clerk165,353.16 -8,696.69 Engineer 165,353.16 -8,696.69 Senior Planner165,353.16 -8,696.69 Development Services Coordinator165,353.16 -8,696.69 GIS/Database Administrator165,353.16 -8,696.69 Accountant/Budget Analyst165,353.16 -8,696.69 Housing and Homeless Services Coordinator165,353.16 -8,696.69 Associate Planner154,818.50 -7,827.56 Assistant Engineer154,818.50 -7,827.56 IT Specialist154,818.50 -7,827.56 Engineering Technician II154,818.50 -7,827.56 Economic Development Project Specialist154,818.50 -7,827.56 Senior Plans Examiner154,818.50 -7,827.56 Public Information Officer 154,818.50 -7,827.56 Administrative Analyst154,818.50 -7,827.56 Maintenance/Construction Foreman154,818.50 -7,827.56 GIS Analyst154,818.50 -7,827.56 Mechanic144,336.92 -7,045.35 Human Resource Analyst 144,336.92 -7,045.35 CenterPlace Coordinator144,336.92 -7,045.35 Planner144,336.92 -7,045.35 Building Inspector II144,336.92 -7,045.35 Plans Examiner144,336.92 -7,045.35 Engineering Technician I144,336.92 -7,045.35 Senior Permit Specialist144,336.92 -7,045.35 Code Enforcement Officer144,336.92 -7,045.35 Maintenance/Construction Inspector 144,336.92 -7,045.35 Recreation Coordinator133,902.91 -6,340.57 Deputy City Clerk133,902.91 -6,340.57 Customer Relations/Facilities Coordinator133,902.91 -6,340.57 Building Inspector I133,902.91 -6,340.57 Executive Assistant133,902.91 -6,340.57 Planning Technician133,902.91 -6,340.57 Human Resources Technician133,902.91 -6,340.57 Senior Center Specialist123,513.90 -5,706.37 Permit Facilitator123,513.90 -5,706.37 Help Desk Technician123,513.90 -5,706.37 Accounting Technician123,513.90 -5,706.37 Administrative Assistant123,513.90 -5,706.37 Recreation Specialist123,513.90 -5,706.37 Maintenance Worker11-123,161.54 -5,706.37 Permit Specialist 113,161.54 -5,135.98 Office Assistant II10-112,845.20 -5,135.98 Custodian102,845.20 -4,621.30 Office Assistant I9-102,561.00 -4,621.30 Note: Slight rounding differences may exist between the figures reflected on this page and the actual payroll rates computed by the Eden Payroll System. Ordinance 21-006amending the 2021budgetPage 4 of 4 CITY OF SPOKANE VALLEY Request for Council Action Meeting Date:May 18, 2021Department Director Approval: Check all that apply:consentold businessnew businesspublic hearing informationadmin. reportpending legislationexecutive session AGENDA ITEM TITLE:Motion consideration -proposedland acquisition–Central Valley School th District Ponderosa propertyat 44Avenue and Bates Road. GOVERNING LEGISLATION:RCW 35A.11.020;RCW 36.34.340;SVMC 3.49.010. PREVIOUS COUNCIL ACTION TAKEN:May 4, 2021administrative report. BACKGROUND:In years past, CVSD purchased a number of large parcels in various areas CVSD thought may experience enough growth to warrant construction of a school facility. As time passes, CVSD gets more clarity on whether such parcels are needed, or whether unneededparcels could be sold and the sale proceedsused elsewheremore effectively. The Central Valley School District (CVSD) owns six parcels of real property generally located at or near th the location of Bates Road and 44Avenue in the Ponderosa area, more particularly identified as Spokane County Assessor Parcel Numbers 44041.0102, 44041.0103, 44041.0104, 44041.9007, 44041.9046, and 44041.9048, all of which comprise approximately 17.7 acres. Discussions between staff for the respective agencies determined there may be mutual interest in a sale from CVSD to the City for park purposes. This lies in an area that was identified in the recent Parks Master Plan Update in 2019 as an area needing additional park space.(Seemap of the future park needs from the 2019 Parks Master Plan Update, attached.) In the discussions with CVSD, City staff also learnedthat Fire District 8 would likely be interested in participating in the acquisition. Fire District 8 has a station on the southwest corner of the intersection of th 44and Bates, but the facility isrelatively old, and Fire District 8 may want to replace it with a modern facility that has additional amenities. City staff has been in contact with them as well. CVSD had the property appraised, and in a January 5, 2021 appraisal report, the fair market value was established at $1,575,000 for all six combined parcels. The City finalizinga purchase and sale agreement with CVSD for that amount.At the same time, City staff have been negotiating an interlocal agreement with Fire District 8 similar to what we did with the Spokane County Library District for the Balfour property across the street from City Hall. In this situation, once the City owned the property, it would sell three to four acres to Fire District 8. We would then enter into a joint site development plan where the City and Fire District 8 would scope out what their needs were, and adjust the amount of acreage to Fire District8 accordingly.That would be followed by a boundary line adjustment to clean up the property boundaries. Asatellite image of the site is included for referenceregarding the location. OPTIONS:(1) Approve purchase of 17.7 acres from CVSD; or (2) take other action as appropriate. RECOMMENDED ACTION OR MOTION:I move we authorize the City Manager to finalize and execute any paperwork necessary to purchase approximately 17.7 acres of vacant land from Central Valley School District for $1.575 million, comprised of Spokane County Assessor Parcel Numbers 44041.0102, 44041.0103, 44041.0104, 44041.9007, 44041.9046, and 44041.9048. BUDGET/FINANCIAL IMPACTS:$1,575,000 plus associated closing costs in closing a transaction.Acquisition of this property is not currently included as an appropriation in the 2021 Budget.If the acquisition is approved, the funds are anticipated to come from Fund 312 from the newest layer of transfers from the General Fund, which is included in the proposed 2021 budget amendment that is currently in process.First reading of the 2021 budget amendment ordinance is also ontonight’s agenda. STAFF CONTACT:Cary Driskell, City Attorney; John Bottelli, Parks, Recreation and Facilities Director. ___________________________________________________________________________ ATTACHMENTS: (1) satellite map of vicinity with proposed purchase area outlined in green; and (2) map ofthe future park needs from the 2019 Parks Master Plan Update. CITY OF SPOKANE VALLEY Request for Council Action Meeting Date:May 18, 2021 Department Director Approval: Check all that apply:consent old business new business public hearing informationadmin. reportpending legislationexecutive session AGENDA ITEM TITLE:Motion Consideration: Proposed Land Acquisition,Flora Road& Montgomery Avenue GOVERNING LEGISLATION:RCW 35A.11.020; SVMC 3.49.010 PREVIOUS COUNCIL ACTION TAKEN:May 4, 2021: AdministrativeReport BACKGROUND:The City of SpokaneValley, along with other local and regional entities as partners, is instrumental in the ongoing operations and maintenance of the Centennial Trail, a 37 mile long trail that winds from the Nine Mile Recreation Area on Lake Spokane eastward to the Idaho border. Within the borders of the City of Spokane Valley, the City is responsible for general maintenance and operations of the trail. The development of additional parking facilities and trailheads has been an integral part of expanding the trail facilities. One such location for a proposed trailhead is located at the intersection of North Flora Road and East Montgomery Avenue. Recently, Spokane County approached the City indicating they would like to surplus Spokane County parcel number 55073.0458at this location, which encompasses 19,690 square feet. The County isoffering it to the City for purchase. After consideration regarding the existing Centennial Trail and the planned City Spokane River Loop Trail, purchase and development of this parcel by the City would provide a valuable park system amenity to the region. As part of its due diligence, Spokane County completed an appraisal of the property, establishing the fair market value of the parcel at $286,000. The City, after reviewing the appraisal, concurs that the appraisal represents the fair market value. In order for the City to further the development of the Centennial Trail and its possible connection to the City’s Spokane River Loop Trail at Flora Road, acquisition of this parcel for the development of a trailhead with parking is recommended. OPTIONS:1) Move to acquire the parcelfrom Spokane County, or 2) take other appropriate action. RECOMMENDED ACTION OR MOTION:Move to authorize staff to finalize and execute any documents necessary to acquire Spokane County parcel number 55073.0458from Spokane County for future parksandrecreation facility use. BUDGET/FINANCIAL IMPACTS:The total acquisition costs for theparcel is $286,000 plus associated closing costs. Acquisition of this property is included as an appropriation in the Capital Reserve Fund #312, included in the 2021 Budget Amendment #1. STAFF CONTACT:Bill Helbig,City Engineer ATTACHMENTS:Flora Road & Montgomery AvenueProperty Acquisition CITY OF SPOKANE VALLEY Request for Council Action Meeting Date: May 18, 2021 Department Director Approval: Check all that apply: consent old business new business public hearing information admin. report pending legislation executive session AGENDA ITEM TITLE: Motion Consideration: Bid Award Evergreen Road Preservation- Sprague Avenue to Broadway Avenue. GOVERNING LEGISLATION: SVMC 3.35.10 Contract Authority PREVIOUS COUNCIL ACTION TAKEN: May 21, 2019: Administrative Report on the 2020-2021 Six Year Transportation Improvement Plan, which included this project. June 4, 2019: Council passed Resolution 19-008, adopting the 2020-2021 Six Year Transportation Improvement Plan, which included this project. May 5, 2020: Administrative Report on the 2021-2026 Six Year Transportation Improvement Plan, which included this project. May 26, 2020: Council passed Resolution 20-009, adopting the 2021-2026 Six Year Transportation Improvement Plan, which included this project. BACKGROUND: The road preservation project grinds and provides an asphalt overlay on Evergreen Road from Sprague Avenue to Broadway Avenue. The project includes installation of ADA curb ramps, pavement repairs, channelization, ITS conduit, and signal upgrades at the Broadway intersection. The current estimated project budget and cost are shown below: Project Costs Project Budget Preliminary Engineering $ 45,500 City Fund 301 $ 350,000 Construction $ 1,854,500 City Fund 311 $ 1,550,000 Total Estimated Costs $ 1,900,000 Total Budget $ 1,900,000 The project was designed in house and advertised on April 20, 2021. Bids will be opened on May 14, 2021, and as such, inclusion of the Bid Tabulation and recommendation for award is not available at time of Council Agenda publication. This information and a formal recommendation will be made at the Council Meeting, the timing of which is necessary to assure timely project completion. OPTIONS: Move to award the contract to the lowest responsive and responsible bidder, or take other appropriate action RECOMMENDED ACTION OR MOTION: Move to award the Evergreen Road Preservation Project CIP #323 to _____________________________ and authorize the City Manager to finalize and execute the construction contract. BUDGET/FINANCIAL IMPACTS: Budget impacts will be discussed with Council at the meeting. STAFF CONTACT: William Helbig, PE, City Engineer ATTACHMENTS: The Bid Tabulation and award recommendation will be provided at the meeting. CITY OF SPOKANE VALLEY Request for Council Action Meeting Date:May 18, 2021 Department Director Approval: Check all that apply: consent old business new business public hearing informationadmin. report pending legislationexecutive session AGENDA ITEM TITLE:Draft2022-2027 Six-Year Transportation Improvement Program (TIP) GOVERNING LEGISLATION: RCW 35.77.010, Perpetual advanced six-year plans for coordinated transportation program expenditures. PREVIOUS COUNCIL ACTION TAKEN: Annual adoption of the TIP and its amendments. BACKGROUND: TheTIP is composed of transportation projects intended to be implemented in the next six years that address the transportation needs within the City of Spokane Valley. The City is required by RCW 35.77.010 toprepare and, after holding a public hearing, adopt a comprehensive transportation program for the ensuing six calendar years. This plan must be th submitted to the Washington State Department of Transportation by June 30of each year. The attached draft six-yearTIP presents an integrated approach to project selection and phasing that has been aligned with recent master plans, upcoming redevelopment projects, economic development efforts, land use changes, stormwater and water district plans, and capital projects by partner agencies. The six-year TIP is required to be financially constrained. Currently the six-year TIP may exceed financial expectations; however, it does accurately reflect the City’s short-term transportation needs and provides a prioritized path forward. OPTIONS:Discussion RECOMMENDED ACTION OR MOTION:Noneat this time. The public hearing for this TIP is scheduled for June 8, 2021, along with a resolutionto adopt the TIP, for Council’sconsideration. BUDGET/FINANCIAL IMPACTS: The required City match on federal and state fundedprojects is typically between 10% and 20%. A review of projected REET funds through 2027 will be provided to determine if there are sufficient funds to provide the City’s match for the recommended projects. STAFF CONTACT: Adam Jackson, P.E. – Planning & Grants Engineer ___________________________________________________________________________ ATTACHMENTS: PowerPoint Presentation Draft Resolution 21-xxx Draft 2022-2027Six-Year TIP Report DRAFT CITY OF SPOKANE VALLEY SPOKANE COUNTY, WASHINGTON RESOLUTION 21-XXX A RESOLUTION OF THE CITY OF SPOKANE VALLEY, SPOKANE COUNTY, WASHINGTON, ADOPTING THE 2022-2027TRANSPORTATION IMPROVEMENT PROGRAM FOR THE CITY OF SPOKANE VALLEY, AND OTHER MATTERS RELATING THERETO. WHEREAS, to provide for the proper and necessary development of the street system within the City of Spokane Valley, the City shall, pursuant to RCW 35.77.010, develop and adopt annually a Six-Year Transportation Improvement Program (Six-Year TIP) with such program acting as a guide for the coordinated development of the City’s transportation system; and WHEREAS, the Six-Year TIP of the City shall specifically set forth those projects and programs of both City and regional significance that benefit the transportation system and promote public safety and efficient vehicle movements;and WHEREAS, the Six-Year TIP shall be consistent with the City’sComprehensive Planand be adopted following one or more public hearings before the City Council; and WHEREAS, a draft copy of the Six-Year TIP was submitted to the Washington State Department of Commerce and has been reviewed and approvedprior to the scheduled adoption of the TIPin accordance with RCW 36.70A.106;and WHEREAS, following adoption of the Six-Year TIP, the City will forward a copy to the Washington State Secretary of Transportation; and WHEREAS, the City Council conducted a public hearing on June 8, 2021 for the purpose of inviting and receiving public comment on the proposed Six-Year TIP. NOW THEREFORE, be it resolved by the City Council of the City of Spokane Valley, Spokane County, Washington, as follows: Section 1. The City Council hereby adopts the attached Six-Year TIP for the City of Spokane Valley for the purpose of guiding the design, development and construction of local and regional transportationimprovements for the years 2022through 2027. The City Clerk is directed to file the 2022- 2027Six-Year TIPwith the Washington State Secretary of Transportation before June 30,2021. The Six- Year TIP shall be reviewed at least annually for the purpose of determining the work to be accomplished under the program and the City’s transportation requirements. Projects and timeframes identified in theSix-YearTIP are to be considered estimates only that may change due to a variety of circumstances, and are not intended by the City to be relied upon by property owners or developers in making development decisions. In the event a railroad ceases to use rail right-of-way within the City, the City will utilize all reasonable options available under state or federal law to preserve the right-of-way for future rail purposes pursuant to RCW 35.77.010(3), Section 2. Effective Date .This Resolution shall be in full force and effect upon adoption. Resolution 21-XXX, Adopting Six-Year TIP DRAFT th Adopted this 8 day of June, 2021. ATTEST: City of Spokane Valley __________________________________ Christine Bainbridge, City Clerk Ben Wick, Mayor Approved as to Form: Office of theCity Attorney Resolution 21-XXX, Adopting Six-Year TIP 2020 Local Access Streets (Barker Rd. Homes)Sullivan Rd. Bridge Deck ResurfacingCitywide Reflective Post Panels (2018) 123 Citywide Reflective Signal Backplates (2018)Park Rd. SidewalkBarker Rd. Improvements - Spokane River to Euclid 456 Balfour Park Frontage ImprovementsMullan Rd. Preservation - Broadway to MissionAppleway Blvd. Stormwater Improvements 789 Evergreen Rd. Preservation - Sprague to MissionSprague Ave. / Barker Rd. Intersection ImprovementBarker Rd. at Union Pacific Crossing 101112 Pines Rd. / Mission Ave. Intersection ImprovementSullivan Rd. / Wellesley Ave. Intersection ImprovementBroadway Ave. - Havana to Fancher 131415 Broadway Preservation - Fancher to ParkSprague Preservation - Havana to FancherPedestrian & Bicycle Safety Analysis 161718 Sullivan Rd. Preservation - Sprague to 8thSullivan Rd. Preservation - 8th to 16thSprague Ave. Stormwater Improvements 192021 Wilbur Rd. Sidewalk - Boone to MissionBarker Rd. / BNSF Grade Separation ProjectPark Rd. / Mission Ave. Intersection Improvement 222324 8th Ave. Preservation - Progress to SullivanMission Ave. Bridge ResurfacingSpokane Valley River Loop Trail 252627 Argonne Rd. Concrete Pavement - Indiana to MontgomeryPines Rd. (SR27) / BNSF Grade Separation ProjectSullivan Rd. / SR 290 Interchange Reconstruction 282930 Local Access Street Improvements - $1.5M AnnuallyStreet Preservation Projects - $3M AnnuallyCitywide Safety Projects - Biennial 313233 Mission Ave. Preservation - Mullan to UniversitySouth Bowdish Rd. - Phased Corridor ImprovementsSullivan Rd. Preservation - 16th to S. City Limit 343536 Dishman-Mica Rd. Preservation - Schafer to S. City LimitVera Crest + Rocky Ridge Street Reconstruction Projects8th Ave. / Carnahan Rd. Intersection Improvement 373839 Barker Rd. Intersection Improvements at 4th & 8thMirabeau Parkway / Mansfield Ave. Intersection ImprovementBarker Rd. Improvement Project - I-90 to Appleway 404142 Flora Rd. Reconstruction - Euclid to GarlandPark Rd. Preservation - Sprague to TrentFlora Rd. / SR 290 Intersection Improvement 434445 Cataldo Ave. Realignment at Barker Rd.32nd Ave. Preservation - Pines to SR 27Wellesley Ave. Preservation - Sullivan to Flora 464748 Barker Rd. Improvement - Appleway to S. City LimitsPines Rd. (SR-27) / 16th Ave. Intersection ImprovementBarker Rd. - Mission to Interstate 90 495051 8th Ave. Preservation - Havana to ParkAppleway Trail - Farr to Dishman MicaArgonne Rd. & I-90 Interchange Bridge Widening 525354 8th Ave. / Park Rd. Intersection ImprovementBarker Rd. / Boone Ave. Intersection ImprovementBroadway Ave. Improvements - Flora to Barker 555657 4th Ave. / Pines Rd. (SR 27) Intersection ImprovementsSullivan Rd. / Kiernan Ave. Intersection ImprovementSullivan Rd. / Marietta Ave. Intersection Improvement 585960 Boone Ave. Reconstruction - Flora to BarkerFlora Rd. Reconstruction - Sprague to MontgomeryEuclid Ave. Preservation - Barker to E. City Limit 616263 Sullivan Rd. Improvements - Trent to Wellesley 64 1. 2020 Local Access Streets (Barker Rd. Homes) E Project Type:Street Preservation Project Description: County sewer partnership. City to reimburse County for paving and stormwater costs. Funding Status: Secured Project Phase(s): Secured Cost EstimateEstimated Project (in $1,000) Schedule 2019 Preliminary Engineering (PE): 50 - Right of Way (RW): 0 2020-2021 Construction (CN): 1,750 1,800 Total Cost: 3/!Tvmmjwbo!Se/!Csjehf!Efdl Sftvsgbdjoh E Qspkfdu!Uzqf;Bridge Qspkfdu!Eftdsjqujpo; Resurface existing bridge deck on northbound bridge over UPRR tracks. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2019-2020 Preliminary Engineering (PE): 68 - Right of Way (RW): 0 2021 Construction (CN): 270 338 Total Cost: 4/!Djuzxjef!Sfgmfdujwf!Qptu!Qbofmt )3129* E Qspkfdu!Uzqf;Safety Qspkfdu!Eftdsjqujpo; Installation of reflective post panels to stop signs and speed limit signs on select streets. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2019 Preliminary Engineering (PE): 6 - Right of Way (RW): 0 2020-2021 Construction (CN): 72 78 Total Cost: 5/!Djuzxjef!Sfgmfdujwf!Tjhobm Cbdlqmbuft!)3129* E Qspkfdu!Uzqf;Safety Qspkfdu!Eftdsjqujpo; Installation of reflective backplate panels at select traffic signals. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2019 Preliminary Engineering (PE): 15 - Right of Way (RW): 0 2020-2021 Construction (CN): 165 180 Total Cost: 6/!Qbsl!Se/!Tjefxbml E Qspkfdu!Uzqf;Pedestrian/Bicycle Improvement Qspkfdu!Eftdsjqujpo; New sidewalk on west side from Sharp to Mission with potential marked crossing at Sharp or Cataldo. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2020 Preliminary Engineering (PE): 50 - Right of Way (RW): 0 2021 Construction (CN): 683 733 Total Cost: 7/!Cbslfs!Se/!Jnqspwfnfout!. Tqplbof!Sjwfs!up!Fvdmje E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Reconstruct and widen to 3-lane urban section to east leg of Euclid. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2019 Preliminary Engineering (PE): 165 2020 Right of Way (RW): 195 2020-2021 Construction (CN): 2,831 3,191 Total Cost: 8/!Cbmgpvs!Qbsl!Gspoubhf Jnqspwfnfout E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation, widen paved shoulder, install curb and sidewalk on Herald, Main and Balfour. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2020 Preliminary Engineering (PE): 100 - Right of Way (RW): 0 2021 Construction (CN): 1,900 2,000 Total Cost: 9/!Nvmmbo!Se/!Qsftfswbujpo!. Cspbexbz!up!Njttjpo E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Preservation project with conduit for future ITS infill, signals improvements at Mission. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2020 Preliminary Engineering (PE): 149 2020 Right of Way (RW): 160 2021 Construction (CN): 1,091 1,400 Total Cost: :/!Bqqmfxbz!Cmwe/!Tupsnxbufs Jnqspwfnfout E Qspkfdu!Uzqf;Stormwater Qspkfdu!Eftdsjqujpo; Improve stormwater facilities between University and Farr. Funded by Dept. of Ecology. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2020-2021 Preliminary Engineering (PE): 100 2020-2021 Right of Way (RW): 100 2021 Construction (CN): 1,250 1,450 Total Cost: 21/!Fwfshsffo!Se!Qsftfswbujpo!. Tqsbhvf!up!Njttjpo E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Signal and channelization upgrades to improve capacity and additional turn lane on southbound Pines. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2020-2021 Preliminary Engineering (PE): 100 - Right of Way (RW): 0 2021-2022 Construction (CN): 2,900 3,000 Total Cost: 22/!Tqsbhvf!Bwf/!0!Cbslfs!Se/ Joufstfdujpo!Jnqspwfnfou E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Provide new roundabout and with sidewalks and bike accomodations. Gvoejoh!Tubuvt;!Partial Qspkfdu!Qibtf)t*;!Partial Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2019-2021 Preliminary Engineering (PE): 165 2021-2022 Right of Way (RW): 270 2022 Construction (CN): 1,835 2,270 Total Cost: 23/!Cbslfs!Se/!bu!Vojpo!Qbdjgjd Dspttjoh E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Recnstruct and widen to 3-lane urban section at UPRR and E. Euclid Ave. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2020-2021 Preliminary Engineering (PE): 85 2021 Right of Way (RW): 50 2022 Construction (CN): 1,299 1,434 Total Cost: 24/!Qjoft!Se/!0!Njttjpo!Bwf/ Joufstfdujpo!Jnqspwfnfou E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Signal and channelization upgrades to improve capacity and additional turn lane on southbound Pines. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2020-2022 Preliminary Engineering (PE): 400 2021-2022 Right of Way (RW): 140 2022-2023 Construction (CN): 1,560 2,100 Total Cost: 25/!Tvmmjwbo!Se/!0!Xfmmftmfz!Bwf/ Joufstfdujpo!Jnqspw/ E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Traffic signal and intersection improvement project, partnership with Spokane County. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2019-2021 Preliminary Engineering (PE): 225 2020-2021 Right of Way (RW): 185 2022 Construction (CN): 2,000 2,410 Total Cost: 26/!Cspbexbz!Bwf/!Qsftfswbujpo!. Ibwbob!up!Gbodifs E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation, including stormwater improvements as necessary. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2019-2022 Preliminary Engineering (PE): 100 - Right of Way (RW): 0 2023 Construction (CN): 2,900 3,000 Total Cost: 27/!Cspbexbz!Bwf/!Qsftfswbujpo!. Gbodifs!up!Qbsl E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement Preservation Project Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2022 Preliminary Engineering (PE): 150 - Right of Way (RW): 0 2023 Construction (CN): 1,850 2,000 Total Cost: 28/!Tqsbhvf!Bwf/!Qsftfswbujpo!. Ibwbob!up!Gbodifs E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation project. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2022 Preliminary Engineering (PE): 150 - Right of Way (RW): 0 2023 Construction (CN): 1,850 2,000 Total Cost: 29/!Qfeftusjbo!'!Cjdzdmf!Tbgfuz Bobmztjt E Qspkfdu!Uzqf;Safety Qspkfdu!Eftdsjqujpo; Evaluate vehicle vs. pedestrian/bicycist crashes, as identified in the Local Road Safety Plan. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2022-2023 Preliminary Engineering (PE): 50 - Right of Way (RW): 0 - Construction (CN): 0 50 Total Cost: 2:/!Tvmmjwbo!Se/!Qsftfswbujpo!. Tqsbhvf!up!9ui E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation with signal, sidewalks and stormwater improvements as necessary. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2021-2022 Preliminary Engineering (PE): 100 2022 Right of Way (RW): 400 2023 Construction (CN): 2,900 3,400 Total Cost: 31/!Tvmmjwbo!Se/!Qsftfswbujpo!.!9ui!up 27ui E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation with signal, sidewalks and stormwater improvements as necessary. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2021-2022 Preliminary Engineering (PE): 100 - Right of Way (RW): 0 2024 Construction (CN): 1,300 1,400 Total Cost: 32/!Tqsbhvf!Bwf/!Tupsnxbufs Jnqspwfnfout E Qspkfdu!Uzqf;Stormwater Qspkfdu!Eftdsjqujpo; Drywell retrofits between University and Park. Funded by Dept. of Ecology. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2021 Preliminary Engineering (PE): 100 - Right of Way (RW): 0 2022 Construction (CN): 1,900 2,000 Total Cost: 33/!Xjmcvs!Se/!Tjefxbml!.!Cppof!up Njttjpo E Qspkfdu!Uzqf;Pedestrian/Bicycle Improvement Qspkfdu!Eftdsjqujpo; Install sidewalk from Boone to Mission on one side of road. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2021-2022 Preliminary Engineering (PE): 60 2021-2022 Right of Way (RW): 20 2022 Construction (CN): 564 644 Total Cost: 34/!Cbslfs!Se/!0!COTG!Hsbef Tfqbsbujpo!Qspkfdu E Qspkfdu!Uzqf;Bridge Qspkfdu!Eftdsjqujpo; Construct Grade Separation at Barker/BNSF RR/Trent (SR290). Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2019 Preliminary Engineering (PE): 2,595 2020 Right of Way (RW): 2,545 2020-2023 Construction (CN): 21,030 26,170 Total Cost: 35/!Qbsl!Se/!0!Njttjpo!Bwf/ Joufstfdujpo!Jnqspwfnfou E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Improve channelization and signal operations. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2022-2023 Preliminary Engineering (PE): 100 2023-2024 Right of Way (RW): 60 2024 Construction (CN): 1,340 1,500 Total Cost: 36/!9ui!Bwf/!Qsftfswbujpo!.!Qsphsftt up!Tvmmjwbo E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Street preservation with potential sidewalk extension and partnership with Vera Water & Power. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2022-2023 Preliminary Engineering (PE): 50 - Right of Way (RW): 0 2024 Construction (CN): 650 700 Total Cost: 37/!Njttjpo!Bwf/!Csjehf!Sftvsgbdjoh E Qspkfdu!Uzqf;Bridge Qspkfdu!Eftdsjqujpo; Surface preservation of concrete bridge deck over Evergreen Rd. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2022 Preliminary Engineering (PE): 25 - Right of Way (RW): 0 2023 Construction (CN): 240 265 Total Cost: 38/!Tqplbof!Wbmmfz!.!Sjwfs!Mppq!Usbjm E Qspkfdu!Uzqf;Pedestrian/Bicycle Improvement Qspkfdu!Eftdsjqujpo; 5-mile shared-use path on north bank of Spokane River, including two pedestrian bridges. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2022-2024 Preliminary Engineering (PE): 1,000 - Right of Way (RW): 0 - Construction (CN): 15,000 16,000 Total Cost: 39/!Bshpoof!Se/!Dpodsfuf!Qbwf/!. Joejbob!up!Npouhpnfsz E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Reconstruct with concrete and improve signal timing at Montgomery. Gvoejoh!Tubuvt;!Secured Qspkfdu!Qibtf)t*;!Secured Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2020-2023 Preliminary Engineering (PE): 125 2020-2021 Right of Way (RW): 40 2021, 2024 Construction (CN): 5,000 5,165 Total Cost: 3:/!Qjoft!Se/!)TS38*!0!COTG!Hsbef Tfqbsbujpo!Qspkfdu E Qspkfdu!Uzqf;Bridge Qspkfdu!Eftdsjqujpo; Construct Grade Separation at Pines/BNSF RR/Trent (SR290). Gvoejoh!Tubuvt;!Partial Qspkfdu!Qibtf)t*;!Partial Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2020-2023 Preliminary Engineering (PE): 2,494 2021-2022 Right of Way (RW): 4,700 2023-2025 Construction (CN): 21,806 29,000 Total Cost: 41/!Tvmmjwbo!Se/!0!TS!3:1!Joufsdibohf Sfdpotusvdujpo E Qspkfdu!Uzqf;Bridge Qspkfdu!Eftdsjqujpo; Reconstruct interchange to improve safety and capacity. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2021-2024 Preliminary Engineering (PE): 2,650 2025-2026 Right of Way (RW): 1,380 2027-2028 Construction (CN): 22,600 26,630 Total Cost: 42/!Mpdbm!Bddftt!Tusffu Jnqspwfnfout!.!%2/6N!Boovbmmz E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Funded by Street Wear Fee. Project type varies (surface treatments, grind/inlays, reconstruction). Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf Annually Preliminary Engineering (PE): 600 Annually Right of Way (RW): 0 Annually Construction (CN): 8,400 9,000 Total Cost: 43/!Tusffu!Qsftfswbujpo!Qspkfdut!. %4N!Boovbmmz E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Preservation projects, typically arterials or collectors, or used as matching funds for grants. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf Annually Preliminary Engineering (PE): 500 Annually Right of Way (RW): 0 Annually Construction (CN): 17,500 18,000 Total Cost: 44/!Djuzxjef!Tbgfuz!Qspkfdut!. Cjfoojbm E Qspkfdu!Uzqf;Safety Qspkfdu!Eftdsjqujpo; Projects are consistent with the City's Local Road Safety Plan. Awarded projects specified in TIP. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf Annually Preliminary Engineering (PE): 100 Annually Right of Way (RW): 0 Annually Construction (CN): 1,700 1,800 Total Cost: 45/!Njttjpo!Bwf/!Qsftfswbujpo!. Nvmmbo!up!Vojwfstjuz E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation and possible widening project with stormwater improvements as necessary. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2022-2023 Preliminary Engineering (PE): 100 2023-2024 Right of Way (RW): 150 2024 Construction (CN): 1,750 2,000 Total Cost: 46/!Tpvui!Cpxejti!Se/!.!Qibtfe Dpssjeps!Jnqspwfnfout E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Reconstruct Sprague to Dishman Mica as a modified urban street with improvements at 16th/32nd. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2022- Preliminary Engineering (PE): 1,000 2023- Right of Way (RW): 500 2024- Construction (CN): 11,500 13,000 Total Cost: 47/!Tvmmjwbo!Se!Qsftfswbujpo!.!27ui Bwf/!up!Djuz!Mjnju E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation with signal, sidewalks and stormwater improvements as necessary. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2023-2024 Preliminary Engineering (PE): 100 - Right of Way (RW): 0 2024 Construction (CN): 2,100 2,200 Total Cost: 48/!Ejtinbo.Njdb!Se/!Qsft/!.!Tdibgfs up!T/!Djuz!Mjnju E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation project. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2023 Preliminary Engineering (PE): 50 - Right of Way (RW): 0 2024 Construction (CN): 1,250 1,300 Total Cost: 49/!Wfsb!Dsftu!,!Spdlz!Sjehf!Tusffu Sfdpotusvdujpo E Qspkfdu!Uzqf;Street Reconstruction Project Qspkfdu!Eftdsjqujpo; Stormwater/road reconstruction in mulltiple areas: Kahuna Hills, Heather Park, Ridgemont Estates. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2023-2024 Preliminary Engineering (PE): 150 - Right of Way (RW): 0 - Construction (CN): 0 150 Total Cost: 4:/!9ui!Bwf/!0!Dbsobibo!Se/ Joufstfdujpo!Jnqspwfnfou E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Add intersection control (turn lanes, potential signal). Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2023 Preliminary Engineering (PE): 175 2024 Right of Way (RW): 250 2025 Construction (CN): 1,575 2,000 Total Cost: 51/!Cbslfs!Se/!Joufstfdujpo Jnqspwfnfout!bu!5ui!'!9ui E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Provide new traffic signal or roundabout, per S. Barker Corridor Study. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2023-2024 Preliminary Engineering (PE): 100 2025-2026 Right of Way (RW): 100 2026 Construction (CN): 3,300 3,500 Total Cost: 52/!Njsbcfbv!0!Nbotgjfme!Joufstfdujpo Jnqspwfnfout E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Intersection capacity improvements. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2024 Preliminary Engineering (PE): 120 2025 Right of Way (RW): 100 2026 Construction (CN): 685 905 Total Cost: 53/!Cbslfs!Se/!Jnqspwfnfout!. Bqqmfxbz!up!J.:1 E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Reconstruct 5-lane urban section with alignment/channelization improvements at Appleway & Broadway. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2024 Preliminary Engineering (PE): 1,000 2025 Right of Way (RW): 2,000 2026 Construction (CN): 3,500 6,500 Total Cost: 54/!Gmpsb!Se/!Sfdpotusvdujpo!.!Fvdmje up!Hbsmboe E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Reconstruct to an urban arterial section in partnership with Spokane County Sewer Extension Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2024 Preliminary Engineering (PE): 100 2025 Right of Way (RW): 100 2026 Construction (CN): 2,000 2,200 Total Cost: 55/!Qbsl!Se/!Qsftfswbujpo!.!Tqsbhvf up!Usfou E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation project with potential sidewalks at select locations. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2024 Preliminary Engineering (PE): 70 2025 Right of Way (RW): 30 2026 Construction (CN): 1,200 1,300 Total Cost: 56/!Gmpsb!Se/!0!TS!3:1!Joufstfdujpo Jnqspwfnfou E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Provide new signal or roundabout, per adopted Planned Action Ordinance. Assume ROW & CN after 2026. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2024-2025 Preliminary Engineering (PE): 100 2026-2027 Right of Way (RW): 100 2028 Construction (CN): 3,800 4,000 Total Cost: 57/!Dbubmep!Bwf/!Sfbmjhonfou!bu Cbslfs!Se/ E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Realign Cataldo Ave east of Barker to Intersect Boone Ave., per adopted Planned Action Ordinance. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2025-2026 Preliminary Engineering (PE): 100 2026-2027 Right of Way (RW): 500 2028 Construction (CN): 1,400 2,000 Total Cost: 58/!43oe!Bwf/!Qsftfswbujpo!.!Qjoft!up TS!38 E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation project. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2025 Preliminary Engineering (PE): 60 - Right of Way (RW): 0 2026 Construction (CN): 940 1,000 Total Cost: 59/!Xfmmftmfz!Bwf/!Qsftfswbujpo!. Tvmmjwbo!up!Gmpsb E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation project. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2025 Preliminary Engineering (PE): 60 - Right of Way (RW): 0 2026 Construction (CN): 940 1,000 Total Cost: 5:/!Cbslfs!Se/!Jnqspwfnfou!. Bqqmfxbz!up!T/!Djuz!Mjnju E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Reconstruct 3-lane urban section from Appleway to Sprague and 2-lane urban section south of Sprague. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2025 Preliminary Engineering (PE): 200 2026-2027 Right of Way (RW): 100 2028-2029 Construction (CN): 3,200 3,500 Total Cost: 61/!Qjoft!Se!)TS.38*!0!27ui Joufstfdujpo!Jnqspwfnfou E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Add traffic control at five-leg intersecton. Gvoejoh!Tubuvt;!Partial Qspkfdu!Qibtf)t*;!Partial Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2025-2026 Preliminary Engineering (PE): 200 2026-2027 Right of Way (RW): 100 2028 Construction (CN): 4,700 5,000 Total Cost: 62/!Cbslfs!Se/!.!Njttjpo!up!Joufstubuf :1 E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Reconstruct to 5-lane urban section. Improvements at Boone intersection are identified separately. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2025 Preliminary Engineering (PE): 200 2026 Right of Way (RW): 500 2027 Construction (CN): 2,300 3,000 Total Cost: 63/!9ui!Bwf/!Qsftfswbujpo!.!Ibwbob!up Qbsl E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Pavement preservation project with select locations of sidewalk and road widening. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2026 Preliminary Engineering (PE): 60 2027 Right of Way (RW): 100 2028 Construction (CN): 1,840 2,000 Total Cost: 64/!Bqqmfxbz!Usbjm!.!Gbss!up!Ejtinbo Njdb E Qspkfdu!Uzqf;Pedestrian/Bicycle Improvement Qspkfdu!Eftdsjqujpo; Extend Shared Use pathway to Dishman Mica with north connections to City Hall and Balfour Park. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2026-2027 Preliminary Engineering (PE): 100 2028-2029 Right of Way (RW): 100 2029-2030 Construction (CN): 1,000 1,200 Total Cost: 65/!Bshpoof!Se/!'!J.:1!Joufsdibohf Csjehf!Xjefojoh E Qspkfdu!Uzqf;Bridge Qspkfdu!Eftdsjqujpo; Widen Argonne Road bridge to 3 lanes southbound and improve sidewalks. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2026-2027 Preliminary Engineering (PE): 500 - Right of Way (RW): 0 2028-2029 Construction (CN): 14,500 15,000 Total Cost: 66/!9ui!Bwf/!0!Qbsl!Se/!Joufstfdujpo Jnqspwfnfou E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Provide new traffic signal or roundabout. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2026-2027 Preliminary Engineering (PE): 100 2027-2028 Right of Way (RW): 300 2028 Construction (CN): 2,600 3,000 Total Cost: 67/!Cbslfs!Se/!0!Cppof!Bwf/ Joufstfdujpo!Jnqspwfnfou E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Provide new signal or roundabout, per adopted Planned Action Ordinance. Assume ROW & CN after 2025. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2027-2028 Preliminary Engineering (PE): 100 2028-2029 Right of Way (RW): 200 2030 Construction (CN): 2,500 2,800 Total Cost: 68/!Cspbexbz!Bwf/!Jnqspwfnfout!. Gmpsb!up!Cbslfs E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Extend 3-lane urban section to Barker Rd and realign connection east of Barker. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2027-2028 Preliminary Engineering (PE): 100 2028 Right of Way (RW): 500 2029 Construction (CN): 4,400 5,000 Total Cost: 69/!5ui!Bwf/!0!Qjoft!Se/!)TS!38* Joufstfdujpo!Jnqspw/ E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Install new intersection control. Price assumes new signal and channelization. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2027 Preliminary Engineering (PE): 100 2028 Right of Way (RW): 200 2029 Construction (CN): 700 1,000 Total Cost: 6:/!Tvmmjwbo!Se/!0!Ljfsobo!Bwf/ Joufstfdujpo!Jnqspw/ E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Improve channelization and signal operations and reconstruct intersection with concrete. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2027-2028 Preliminary Engineering (PE): 100 2028-2029 Right of Way (RW): 100 2029 Construction (CN): 1,800 2,000 Total Cost: 71/!Tvmmjwbo!Se/!0!Nbsjfuub!!Bwf/ Joufstfdujpo!Jnqspw/ E Qspkfdu!Uzqf;Intersection Improvement Qspkfdu!Eftdsjqujpo; Improve channelization and signal operations and reconstruct intersection with concrete. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2027-2028 Preliminary Engineering (PE): 100 2028-2029 Right of Way (RW): 100 2029 Construction (CN): 1,800 2,000 Total Cost: 72/!Cppof!Bwf/!Sfdpotusvdujpo!. Gmpsb!up!Cbslfs E Qspkfdu!Uzqf;Street Reconstruction Project Qspkfdu!Eftdsjqujpo; Reconstruct corridor to city standards. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2027-2028 Preliminary Engineering (PE): 150 2029-2030 Right of Way (RW): 350 2031 Construction (CN): 3,500 4,000 Total Cost: 73/!Gmpsb!Se/!Sfdpotusvdujpo!. Tqsbhvf!up!Npouhpnfsz E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Reconstruct to city standards, including a shared-use path connecting Appleway & Centennial Trails. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2027-2028 Preliminary Engineering (PE): 150 2029-2030 Right of Way (RW): 250 2031 Construction (CN): 3,600 4,000 Total Cost: 74/!Fvdmje!Bwf/!Qsftfswbujpo!.!Cbslfs up!F/!Djuz!Mjnju E Qspkfdu!Uzqf;Street Preservation Qspkfdu!Eftdsjqujpo; Pavement preservation project. City may elect to improve road section to meet City standards. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2027 Preliminary Engineering (PE): 50 - Right of Way (RW): 0 2028 Construction (CN): 450 500 Total Cost: 75/!Tvmmjwbo!Se/!Jnqspwfnfout!. Usfou!up!Xfmmftmfz E Qspkfdu!Uzqf;Arterial Improvement Qspkfdu!Eftdsjqujpo; Widen for center turn lane, improved access management, lighting, and addition of shared-use path. Gvoejoh!Tubuvt;!Planned Qspkfdu!Qibtf)t*;!Planned Dptu!FtujnbufFtujnbufe!Qspkfdu )jo!%2-111*!Tdifevmf 2027-2028 Preliminary Engineering (PE): 200 2028-2029 Right of Way (RW): 300 2030 Construction (CN): 2,500 3,000 Total Cost: CITY OF SPOKANE VALLEY Request for Council Action Meeting Date:May 18, 2021Department Director Approval Check all that apply:consent old business new business public hearing informationadmin. reportpending legislation executive session AGENDA ITEM TITLE: Housing Action Plan (HAP) GOVERNING LEGISLATION:RCW 36.70A.600 PREVIOUS COUNCIL ACTION TAKEN:September 24, 2019:City Council authorized staff to complete the urban density grant application for the development of a HAP.March 2, 2021: Admin report update on the Housing Action Plan BACKGROUND:A HAP defines strategies and implementing actions that promote greater housing diversity and affordability for residents of all income levels. The HAP includes four main components: a Housing Needs Assessment, a review of policies and regulations affecting housing development, strategies to increase housing based on needs, and an implementation plan. The City applied for and received a $100,000 grant from the Department of Commerce (DOC) to partially fund the development ofa HAP. The City used the grant dollars to contract with Maul, Foster, and Alongi (MFA) to assist in the completion of the HAP.MFA, their sub-consultant ECONorthwest, and City staff have completed the HAP. The HAP provides recommended policies and strategies to meet the housing needs within theCity. The recommendations in the HAP were informed by public engagement, data analysis, and review of existing planning documents, and are intended to be options for the City to consider for future implementation. The guidance provided will be used as a basis for future conversations with staff, stakeholders, renters, homeowners, advocates, developers and many others to determine which strategies should be used to ensure the City has the ability to provide the necessary housing for our community. On March 2, 2021, staff provided an update to City Council that included an overview of the HAP and the anticipated adoption process and timeline. On March 12, 2021, the City staff determined that the adoption of the HAP did not have a probable significant adverse impacton the environment and issued a Determination of Non-Significance. On March 25, 2021, staff provided an overview of the proposed HAPto the Planning Commission. On April 8, 2021, the Planning Commission held a public hearing on the proposed HAP. After receiving public testimony, the Planning Commission closed the public hearing and deliberated on the HAP. After reviewing and deliberating on the HAP, the Planning Commission moved and voted 7-0 to forward the HAP to City Council with a recommendation of approval. Tonight, staff will present an overview of the draft HAP for the purpose of discussion with the City Council. Staff will return on June 1, 2021for a motion consideration for Council to consider adoption ofthe HAP by resolution. BUDGET/FINANCIAL IMPACTS:Noneat this time. OPTIONS:Discussion RECOMMENDED ACTION OR MOTION:No action at this time STAFF CONTACT:Chaz Bates, AICP, Senior Planner ____________________________________________________________________________ ATTACHMENTS:1.Presentation; 2. PC Findings; 3. Draft Resolution;4. May 12, 2021 Letter from Department of Commerce; 5.White Binder (included separately, which containsPlanning Commission materials and draft HAP) 1 of 1 History Refresher Housing Needs Assessment (HNA) family detached - 2/3 of stock single — City’s Housing Needs Assessment Housing Policy and Regulation Review City’s Housing Strategies & Actions Housing Implementation Plan City’s Housing Implementation Plan DRAFT CITY OF SPOKANE VALLEY SPOKANE COUNTY, WASHINGTON RESOLUTION NO. 21-XXX A RESOLUTION OF THE CITY OF SPOKANE VALLEY, SPOKANE COUNTY, WASHINGTON, ADOPTING THE HOUSING ACTION PLANFOR THE CITY OF SPOKANE VALLEY, AND PROVIDING FOR OTHER MATTERS RELATING THERETO. WHEREAS,the Growth Management Act allows cities to adopt a Housing Action Plan (HAP) as described in RCW 36.70A.600(2); and WHEREAS, the goal of a HAP is to encourage the construction of additional affordable and market rate housing in a greater variety of housing types at prices that are accessible to a variety of incomes; and WHEREAS, the City applied for and received grant fundingfrom the Washington State Department of Commerce (Commerce)to develop and adopt a HAP and used the grant funds to contract with Maul, Foster, and Alongi (MFA) to complete the HAP; and WHEREAS, pursuant to the State Environmental Policy Act, RCW 43.21C (SEPA), and Title 21 Spokane Valley MunicipalCode (SVMC), the City issued a Determination ofNon-Significance (DNS) for the HAP on March 12, 2021; and WHEREAS, the requirements of SEPA and Title 21 SVMC have been fulfilled; and WHEREAS, on March 12 and 19, 2021, notice of thePlanning Commissionpublic hearing for the HAP was placed in the Spokane Valley News Herald; and WHEREAS, on March 25, 2021, the City issued a press release on the availability of the HAP, and sent direct email to the HAP distribution list and stakeholders; and WHEREAS, prior to the Planning Commission’s public hearing, the City created a rotating banner on the City’s website that linked to the HAP project page, and published social media posts on Facebook, Twitter and Instagram about the public hearing; and WHEREAS, on April 8, 2021, the Planning Commission held a public hearing, received evidence, information and public testimony followed by deliberations; and WHEREAS, on April 8, 2021, after reviewing and deliberating on the HAP, the Planning Commission moved and voted 7-0 to forward to City Council a recommendation of approval of the HAP; and WHEREAS, on April 22, 2021, the Planning Commission approved findings and recommendations, which are incorporated herein by reference;and WHEREAS, pursuant to the grant agreement with Commerce and RCW 36.70A.600(2), the HAP is required to include the following components: a. A summary of community engagement: The development of the HAP and its strategies included a robust citizen engagement process, which issummarized inAppendix D; Resolution 21-XXXAdopting the 2021 Housing Action Plan Page 1of 2 DRAFT b. Housing needs assessment: The housing needs assessment included in the HAP as Appendix A identifies the City’s housingneeds for all income segmentswithdetailed information about the City’s demographics,includingpopulation and employment trends; c. Recommended policy and code changes: Section 3of the HAP includespolicy and code changes. Section 3 and Appendix C of the HAP include an analysis of the City’s housing element and associated policies in meeting planned housing within the City; d. Housing strategies: Sections3 and 4 of the HAP identify strategies toincrease the supply and variety of housing types and ways tominimize and reduce displacement of low-income residents; and e. Implementation plan: Section 4 of the HAP includes an overview of the strategiesincluding proposed timing and potential needed resourcesfor implementation; and WHEREAS, the HAP is a planning documentand does not amend the City’s Comprehensive Plan or development regulations; and WHEREAS, theimplementation of anyrecommended strategies in the HAPwill undergo itsown process for review, adoption, and engagement; and WHEREAS, consistent with the grant agreement with Washington State Department of Commerce, the HAP is required to be formally adopted by the City. NOW THEREFORE,be is resolved by the City Council of the City of Spokane Valley, Spokane County, Washington as follows: SECTION 1.Findings.The City Council hereby adoptsand incorporates by reference the recitals above as findings for the adoption of the Housing Action Plan.The City Council hereby finds that the HAP complies with all state and local requirements, including the grant with Commerce and RCW 36.70A.600(2). SECTION 2. Adoption. The City Council hereby adoptsthe Housing Action Plan, attached hereto and made a part hereof. SECTION 3. Effective Date. This Resolution shall be effective upon adoption. st Adopted this 1day of June 2021. CITY OF SPOKANE VALLEY ATTEST: _________________________________ Ben Wick, Mayor Christine Bainbridge, City Clerk Approved as to Form: Office of the City Attorney Resolution 21-XXXAdopting the 2021 Housing Action Plan Page 2of 2 STATE OF WASHINGTON DEPARTMENT OF COMMERCE 1011 Plum Street SE PO Box 42525 Olympia, Washington 98504-2525 (360) 725-4000 www.commerce.wa.gov May 12, 2021 Spokane Valley City Council c/o Chaz Bates, Senior Planner City of Spokane Valley 10210 E. Sprague Avenue Spokane Valley, WA 99206 Sent Via Electronic Mail RE: Draft Housing Action Plan Dear council members: Thank you for the opportunity to comment on your proposed draft housing action plan (HAP). We appreciate your coordination with our agency as you work to fulfill the HB 1923 grant contract to develop this plan. Spokane Valley has done an excellent job at completing all of the required elements of a HAP outlined in RCW 36.70A.600(2). The HAP if implemented as designed will help the city meet its housing needs by accommodating the future population demand with a greater diversity of housing options and greater affordability, while addressing displacement and preserving affordable housing. We especially like the following: The housing policy and code review, which notes the actions taken by the city and evaluates progress towards the housing goals. This provides a strong basis for the HAP strategy recommendations. The displacement analysis, which will allow the city to carefully evaluate and implement specific development regulation and policy changes in the future with an understanding for where they may have impacts. The development feasibility analysis provides an evaluation of possible development scenarios and a strong foundation and knowledge base for the recommendations. The breadth of housing strategy recommendations that not only address the goals and objectives of the HAP, including displacement, but also includes next steps for each strategy. The implementation plan that identifies the action needed, partnerships, staff time and the proposed timing of each strategy which will allow the city to program and plan the next steps to implement the recommendations. Spokane Valley City Council May 12, 2021 Page 2 As the city looks to adoption and implementation of this strong set of housing strategies, we recommend the city make a plan for how you want to monitor the goals within the HAP. The potential indicators are a great start, but a monitoring plan would allow the city to measure its progress and evaluate which changes have been effective at meeting the goals, and which might need modifications to meet the intended purpose. Congratulations to the staff for the great work the draft housing action plan represents. If you have any questions or need technical assistance, please feel free to contact me at benjamin.serr@commerce.wa.gov or (509) 724-1699. We extend our continued support to the City of Spokane Valley as you review this draft plan for adoption as intended direction for housing policy. Sincerely, Benjamin A. Serr Eastern Washington Regional Manager Growth Management Services cc: Chaz Bates, Senior Planner, City of Spokane Valley Mike Basinger, Economic Development Manager, City of Spokane Valley David Andersen, AICP, Managing Director, Growth Management Services Steve Roberge, Deputy Managing Director, Growth Management Services Anne Fritzel, AICP, Senior Housing Planner, Growth Management Services Laura Hodgson, Associate Housing Planner, Growth Management Services City of Spokane Valley Housing Action Plan Index Index Tab No. Summary of Amendment Request for Planning Commission Action; Meeting Minutes and Presentation 1 (Public Hearing) 2 Draft Housing Action Plan 3 Section 2 – Draft Housing Action Plan 4 Section 3 – Draft Housing Action Plan 5 Section 4 – Draft Housing Action Plan 6 A-Appendices –Draft Housing Action Plan 7 B Appendices – Draft Housing Action Plan 8 C Appendices –Draft Housing Action Plan 9 D Appendices –Draft Housing Action Plan 10 E Appendices – Draft Housing Action Plan 11 F Appendices – Draft Housing Action Plan 12 G Appendices – Draft Housing Action Plan 13 Public Comments UBC$2 CITY OF SPOKANE VALLEY Request for Planning Commission Action Meeting Date: March 25, 2021 Item: Check all that apply old business new business public hearing information study session pending legislation AGENDA ITEM TITLE: Housing Action Plan (HAP) GOVERNING LEGISLATION: RCW 36.70A.600 PREVIOUS COMMISSION ACTION: None BACKGROUND: During the 2019 legislative session, E2SHB 1923 was passed which encouraged cities to address their ability to provide housing, and especially more affordable housing, by increasing urban residential capacity. Cities could accomplish these objectives by either adopting a set of zoning amendments or by adopting a HAP. In September of 2019, the City chose to develop a HAP to inform and provide guidance on housing. A HAP defines strategies and implementing actions that promote greater housing diversity and affordability for residents of all income levels. The HAP includes four main components: a Housing Needs Assessment, a review of policies and regulations affecting housing development, strategies to increase housing based on needs, and an implementation plan. To assist with the implementation of E2SHB 1923 the Department of Commerce (DOC) offered grants up to $100,000 to develop and adopt a HAP. In November of 2019 the City was awarded the full grant amount, and in April 2020 entered into a contract with DOC, and in May 2020, the City entered into a contract with Maul, Foster, and Alongi (MFA) to complete the HAP. MFA and their sub-consultant ECONorthwest have completed the HAP. This document is now ready for Planning Commission review. The purpose of the document is to assist the City in accommodating additional housing through 2037. This planning period is defined by the Growth Management Act and cities are required to evaluate their success in attaining planned housing types and units throughout this timeframe. The HAP identifies strategies to promote housing development to assist the City in meeting the projected housing needs. The recommendations in the HAP are meant to encourage more housing for people of all income levels. The HAP provides policies and strategies that could be used to meet the housing needs within the City. The recommendations in the HAP were informed by public engagement, data analysis, review of existing planning documents and staff input. These recommendations are intended to be options for the City to consider for future implementation. The guidance provided in the HAP will be used as a basis for future conversations with staff, stakeholders, renters, homeowners, advocates, developers and many others to determine which strategies should be used to ensure the City has the ability to provide the necessary housing for our community. Tonight, staff will provide an overview of the HAP and the anticipated adoption process and timeline. RECOMMENDED ACTION OR MOTION: No action recommended at this time. ATTACHMENTS: 1. Presentation 2. Draft Housing Action Plan and Appendices (white binder. Please keep the binder for the duration of the recommendation process) RPCA Study Session for Housing Action Plan Page 1 of 1 CITY OF SPOKANE VALLEY Request for Planning Commission Action Meeting Date: April 8, 2021 Item: Check all that apply old business new business public hearing information study session pending legislation AGENDA ITEM TITLE: Housing Action Plan (HAP) GOVERNING LEGISLATION: RCW 36.70A.600 PREVIOUS COMMISSION ACTION: Study Session, March 25, 2021 BACKGROUND: During the 2019 legislative session, E2SHB 1923 was passed which encouraged cities to address their ability to provide housing, and especially more affordable housing, by increasing urban residential capacity. In September of 2019, the City chose to develop a HAP to inform and provide guidance on housing. A HAP defines strategies and implementing actions that promote greater housing diversity and affordability for residents of all income levels. The HAP includes four main components: a Housing Needs Assessment, a review of policies and regulations affecting housing development, strategies to increase housing based on needs, and an implementation plan. To assist with the implementation of E2SHB 1923 the Department of Commerce (DOC) offered grants up to $100,000 to develop and adopt a HAP. In November of 2019 the City was awarded the full grant amount, and in April 2020 entered into a contract with DOC, and in May 2020, the City entered into a contract with Maul, Foster, and Alongi (MFA) to complete the HAP. MFA and their sub-consultant ECONorthwest have completed the HAP. The purpose of the document is to assist the City in accommodating additional housing through 2037. This planning period is defined by the Growth Management Act and cities are required to evaluate their success in attaining planned housing types and units throughout this timeframe. The HAP identifies strategies to promote housing development to assist the City in meeting the projected housing needs. The recommendations in the HAP are meant to encourage more housing for people of all income levels. The HAP provides policies and strategies that could be used to meet the housing needs within the City. The recommendations in the HAP were informed by public engagement, data analysis, review of existing planning documents and staff input. These recommendations are intended to be options for the City to consider for future implementation. The guidance provided in the HAP will be used as a basis for future conversations with staff, stakeholders, renters, homeowners, advocates, developers and many others to determine which strategies should be used to ensure the City has the ability to provide the necessary housing for our community. On March 12, 2021, the City has determined that the adoption of the HAP did do not have a probable significant adverse impacts on the environment and issued a Determination of Non-Significance. On March 25, 2021, staff provided an overview of the proposed HAP. Tonight, the Planning Commission will hold a public hearing for the purpose of taking public testimony on the HAP. RECOMMENDED ACTION OR MOTION: I move that the Planning Commission approve and forward to City Council a recommendation of approval of the Housing Action Plan. ATTACHMENTS: 1. Presentation 2. Please bring your white binder with the draft HAP and appendices. RPCA Study Session for 2021 Shoreline Master Program Update Page 1 of 1 $100,000 grant to complete the work History Refresher Type, age, and amountFor all income levels —— Housing Needs Assessment (HNA) 20,910 - 21,144 - Millennials doubled Seniors continued growth Growth in sectors below 100% AMI 6,660 new units by 2037 ———— City’s Housing Needs Assessment Evaluation of programs Aligned with identified needsAligned with community vision and engagementIdentify regulatory barriers Housing Policy and Regulation Review - rate - allow missing in zones that Preserve affordable housing and mitigate displacement.Increase both marketand affordable housing supply, multifamily and middle housingIncrease housing options and housing choice. City’s Housing Strategies & Actions Identify implementation strategies to achieve housing goals, include: Housing Implementation Plan Identify steps to achieve strategies, including:Monitoring program City’s Housing Implementation Plan CITY OF SPOKANE VALLEY Request for Planning Commission Action Meeting Date: April 22, 2021 Item: Check all that apply old business new business public hearing information study session pending legislation AGENDA ITEM TITLE: Housing Action Plan (HAP) GOVERNING LEGISLATION: RCW 36.70A.600 PREVIOUS COMMISSION ACTION: Study Session, March 25, 2021, Public Hearing, April 8, 2021 BACKGROUND: A HAP defines strategies and implementing actions that promote greater housing diversity and affordability for residents of all income levels. The HAP includes four main components: a Housing Needs Assessment, a review of policies and regulations affecting housing development, strategies to increase housing based on needs, and an implementation plan. To assist with the implementation of E2SHB 1923 the Department of Commerce (DOC) offered grants up to $100,000 to develop and adopt a HAP. On September 24, 2019, the City Council authorized staff to apply for a grant from DOC to develop and adopt a HAP. In November of 2019 the City was awarded the full grant amount, and in April 2020 entered into a contract with DOC, and in May 2020, the City entered into a contract with Maul, Foster, and Alongi (MFA) to complete the HAP. MFA and their sub-consultant ECONorthwest have completed the HAP. The purpose of the document is to assist the City in accommodating additional housing through 2037. This planning period is defined by the Growth Management Act and cities are required to evaluate their success in attaining planned housing types and units throughout this timeframe. The HAP identifies strategies to promote housing development to assist the City in meeting the projected housing needs. The recommendations in the HAP are meant to encourage more housing for people of all income levels. The HAP provides policies and strategies that could be used to meet the housing needs within the City. The recommendations in the HAP were informed by public engagement, data analysis, review of existing planning documents and staff input. These recommendations are intended to be options for the City to consider for future implementation. The guidance provided in the HAP will be used as a basis for future conversations with staff, stakeholders, renters, homeowners, advocates, developers and many others to determine which strategies should be used to ensure the City has the ability to provide the necessary housing for our community. On March 12, 2021, the City determined that the adoption of the HAP did not have a probable significant adverse impact on the environment and issued a Determination of Non-Significance. On March 25, 2021, staff provided an overview of the proposed HAP. On April 8, 2021, the Planning Commission held a public hearing on the proposed HAP. After receiving public testimony, the Planning Commission closed the public hearing and deliberated on the HAP. After reviewing and deliberating on the HAP, the Planning Commission moved and voted 7-0 to forward the HAP to City Council with a recommendation of approval. RECOMMENDED ACTION OR MOTION: I move that the Planning Commission adopt the findings and recommendations and forward to City Council a recommendation of approval of the Housing Action Plan. ATTACHMENTS: 1. Draft Findings and Recommendations for the Proposed Housing Action Plan 2. Public Comment - Spokane Regional Housing Needs Summit, submitted at Public Hearing RPCA Findings and Recommendations for HAP Page 1 of 1 MeetingMinutes Spokane Valley Planning Commission Council Chambers –City Hall April 22, 2021 I.Planning Commission Vice-Chair Bob McKinley called the meeting to order at 6:00p.m. The meeting was held remotely via ZOOM meeting. II.Administrative Assistant Taylor Dillard took roll and the following members and staff were present: Fred BeaulacErik Lamb, City Attorney Karl GranrathJenny Nickerson, Building Official Walt HanekeChaz Bates, Senior Planner Bob McKinley, absentTaylor Dillard, Administrative Assistant Nancy Miller Paul Rieckers Sherri Robinson There was a consensus from the Planning Commission to excuse Chairman McKinley from the meeting. III.AGENDA:CommissionerBeaulac moved to approve the April 22, 2021meetingagenda as presented.There was no discussion. The vote on the motion was six in favor, zero against and the motion passed. IV.MINUTES: Commissioner Haneke moved to approve the April 8, 2021 minutes as presented.There was no discussion. The vote on the motion was sixin favor, zero against and the motion passed. V.COMMISSION REPORTS:There were no Planning Commission reports. VI.ADMINISTRATIVE REPORT:Building Official Jenny Nickerson reminded the Planning Commission of a webinar to be held on Saturday April 24, 2021 regarding Roberts Rules Of Order (Mastering the Meeting). VII.PUBLIC COMMENT:There was no public comment. VIII.COMMISSION BUSINESS: a.Findings Of Fact: Housing Action Plan Senior Planner Chaz Bates presented the Findings of Fact for the Housing Action Plan (HAP) for approval. He stated that the Planning Commission held a public hearing on the proposed HAP at the April 8, 2021 meeting. After receiving public testimony, the Planning Commission moved and voted 7-0 to forward the HAP to City Council with a 1 04-22-2021Planning Commission MinutesPage 2of 2 recommendation of approval. He explained that the approval of the Findings of Fact will formalize the recommendations that were made at thepublic hearing. Commissioner Haneke moved to approve the Planning Commission Findings of Fact for the Housing Action Plan as presented.There was no discussion. The vote on the motion was six in favor, zero against and the motion passed. IX.GOOD OF THE ORDER:Commissioner Miller commented that legislation regarding condominiums is headed to the Governor’s office for approval. X.ADJOURNMENT:CommissionerHanekemoved to adjourn the meeting at6:11p.m. There was no discussion. The vote on the motion was six in favor, zero against, and the motion passed. _________________________________________________________________ Bob McKinley, ChairDate signed ____________________________________ Marianne Lemons,Secretary 2 UBC$3 DRAFT HOUSING ACTION PLAN Prepared for CITY OF SPOKANE VALLEY Prepared by Maul Foster & Alongi, Inc. 2815 2nd Avenue, Suite 540, Seattle, WA 98121 DRAFT ACKNOWLEDGMENTS Maul Foster & Alongi, Inc., in collaboration with ECONorthwest, prepared this report for City of Spokane Valley. We are grateful to the numerous staff, elected officials, and community members who participated in this process and provided feedback to shape the plan. CITY OF SPOKANE VALLEY COUNCIL Councilmember Rod Higgins -(position 1) Councilmember Brandi Peetz – (position 2) -Deputy Mayor Councilmember Arne Woodard – (position 3) Councilmember Ben Wick – (position 4) - Mayor Councilmember Pam Haley – (position 5) Councilmember Tim Hattenburg – (position 6) Councilmember Linda Thompson – (position 7) CONSULTANT TEAM Maul Foster & Alongi, Inc ECONorthwest SPOKANE VALLEY COMMUNITY MEMBERS (ALPHABETICAL ORDER) Lanzce Douglas, Douglas Properties Deb Elzinga, Community Frameworks Jim Frank, Greenstone Michelle Girardot, Habitat for Humanity Rob Higgins, Spokane Association of REALTORS Julie Honekamp, SNAP WA Ray Kimball, Whipple Engineering Jonathan Mallahan, Catholic Charities Jennyfer Mesa, Latinos en Spokane Dave Roberts, Spokane Housing Ventures Ben Stuckart, Spokane Low Income Housing Consortium Todd Walton, Inland Development Darin Watkins, Spokane Association of REALTORS Joel White Spokane, Home Builders Association PAGE II DRAFT CONTENTS 1 PURPOSE 1 1.1 OVERVIEW 1 1.2 ORGANIZATION 2 2 SUPPORTING DATA AND ANALYSIS 3 2.1 SUMMARY OF HOUSING NEEDS ASSESSMENT 3 2.2 SUMMARY OF POLICY AND REGULATORY ASSESSMENT 15 2.3SUMMARY OF PUBLIC ENGAGEMENT18 2.4 DISPLACEMENT RISK ANALYSIS 23 2.5 DEVELOPMENT FEASIBILITY ANALYSIS 25 3 HOUSING STRATEGY RECOMMENDATIONS 29 3.1SUMMARY OF HOUSING STRATEGY RECOMMENDATIONS30 3.2 ASSESSMENT OF HOUSING STRATEGY RECOMMENDATIONS 35 4 IMPLEMENTATION PLAN 54 4.1 DEVELOP AND ASSIGN WORK PROGRAMS 54 4.2 USE TO INFORM HOUSING POLICY AND PLANNING PROJECTS 62 4.3 MONITOR IMPLEMENTATION PROGRESS 62 APPENDIX A HOUSING NEEDS ASSESSMENT APPENDIX B HOUSING NEEDS ASSESSMENT METHODS AND DATA SOURCES APPENDIX C HOUSING POLICY FRAMEWORK APPENDIX D SUMMARY OF COMMUNITY ENGAGEMENT APPENDIX E DEVELOPMENT FEASIBILITY AND MULTIFAMILY PROPERTY TAX EXEMPTION ANALYSIS APPENDIX F AFFORDABLE HOUSING FUNDING SOURCES APPENDIX G ACCESSORY DWELLING UNIT AND TINY HOME POLICY ANALYSIS PAGE III DRAFT 1 PURPOSE 1.1 Overview The City of Spokane Valley’s (City) Housing Action Plan (HAP) defines strategies and implementing actions that promote greater housing diversity, affordability, and access to opportunity for residents of all income levels. This HAP is meant to implement a voluntary program of the Growth Management Act and fulfill a State of Washington Department of Commerce grant that Spokane Valley received through House Bill 1923 which aims to: Quantify existing and projected housing needs for all income levelswith documentation of housing and household characteristics. Develop strategies to increase the supply of housing, and the variety of housing types, needed to serve the housing needs identified above. Analyze population and employment trends, with documentation of projections. Consider strategies to minimize low-income residents’ displacement resulting from redevelopment. Review and evaluate the current housing element adopted pursuant to RCW 36.70A.070, including an evaluation of success in attaining planned housing types and units, achievement of goals and policies, and implementation of the schedule of programs and actions. Provide for participation and input from community members, community groups, local builders, local realtors, nonprofit housing advocates, and local religious groups. Include a schedule of programs and actions to implement the recommendations of this HAP. The purpose of this HAP is to: Provide an overview of the housing landscape and planning environment. Help the City plan for additional housing through 2037 by providing key data and analysis on the current housing inventory and future housing need in Spokane Valley. Highlight current City development regulations and incentives that are effective. Identify strategies that consider emerging development issues to promote housing development that will help meet Spokane Valley’s projected housing needs. Recommend actions that will encourage more housing development at all income levels to accommodate future and current residents. PAGE 1 DRAFT To develop this HAP, the City assessed housing needs, reviewed housing policies, and engaged the public. The results have led to three key housing objectives that are addressed in this HAP: Preserve affordable housing and prevent or mitigate displacement. Increase market-rate and affordable housing supply throughout Spokane Valley, but focus on areas that support multifamily and “missing-middle” housing types. Increase housing options and housing choice. 1.2 Organization This HAPis organized as follows: Supporting Data and Analysis offers background on the housing needs analysis, policy and regulatory review, and public engagement. Housing Recommendations offers 13 policy and program recommendations as Spokane Valley works toward increasing housing supply through 2037. Implementation Plan that provides Spokane Valley with near-term actions for City Councilmembers to consider. Appendices provide technical appendices that support this HAP, including the full public engagement plan, data, methods for key parts of the analysis, affordable housing information, and the policy review. PAGE 2 UBC$4 DRAFT 2 SUPPORTING DATA AND ANALYSIS Incorporated in 2003, the City is the second most populated city in Spokane County, behind the City of Spokane. Spokane Valley can be described as an auto-oriented suburban community with commercial areas and improving mass transit service. Spokane Valley’s population is currently 97,490 (Washington Office of Financial Management \[OFM\], 2020) and has increased by 25,246 people since 2003, translating to a 17.5 percent increase, which equates to an average of approximately one percent of growth per year. Spokane Valley is projected to add 14,103 more residents between 2018 and 2037 (OFM, 2020). The housing market in Spokane Valley has not kept pace with this increased demand brought on by new residents (ECONorthwest, 2020). This underproduction is one important factor in rising rents and home prices. To accommodate new residents, developers in Spokane Valley will need to produce housing at a modestly faster rate than has been done over the past ten years. The new unit production will also have to accommodate households across the income spectrum. The confluence of population growth with a need for more housing spurs many questions: What income and demographic characteristics will future households have? Where will households live and in what housing types? The answers to these questions and the ability of future households to meet their housing needs depend on decisions and policy choices that the City makes today. In response to the housing challenges facing many of its residents, the City has worked locally and regionally to analyze data on the housing needs of current and future residents and to develop strategies that can support housing at a variety of price points to meet these needs. Housing markets function at a regional scale so it can be challenging for individual jurisdictions to adequately address this issue on its own. Partnerships and coordination throughout the broader county/region will be needed to successfully implement this HAP. 2.1 Summary of Housing Needs Assessment The housing needs assessment fact packet (Appendix A) synthesizes background information on the current housing inventory, demographics, and employment trends in Spokane Valley. This assessment helps inform the development of potential strategies. In particular, the housing needs assessment focuses on housing affordability issues and identifies the types of housing that the City should plan for in the future. The data source for the following summary is predominantly 2018 and 2019 data from the OFM, with additional data fromthe U.S. Census Bureau’s Public Use Micro Sample (PUMS) and American Community Survey (ACS). The methods and sources used to develop the housing needs assessment fact packet and the information below are found in Appendix B. PAGE 3 DRAFT 2.1.1 Spokane Valley Employment Trends EMPLOYMENT IN SPOKANE VALLEY CONTINUES TO GROW. The City’s total employment grew from 46,205 jobs in 2010 to 51,305 jobs in 2017, an increase of 5,100 jobs (11 percent change). The top three largest industry sectors, in terms of total employment, were: (1) Retail Trade, with 10,032 employees; (2) Manufacturing, with 6,686 employees; and (3) Health Care and Social Services, with 6,273 employees. Combined, these industry sectors represent 45 percent of Spokane Valley’s total employment base. The sectors with the greatest employment growth from 2010 to 2017 were: (1) Educational Services, with 1,978 new jobs or a 120 percent increase; (2) Construction, with 978 new jobs or a 45 percent increase, and (3) Wholesale Trade, with 684 new jobs or a 23 percent increase. Combined, these three industries represent a gain of around 3,640 employees. Median salaries in 2018 also varied by industry. At opposite ends of the wage spectrum are the Accommodations and Food Services industry (average wage: $28,307 per year) and the Utilities sector (average wage: $69,936 per year). The Manufacturing sector, which makes up 13 percent of the 1 workforce, averages an annual wage of $46,683 per year. Figure 1 presents a travel shed map showing access to employment within a 45-minute drive and 45-minute transit trip. There are 260,178 jobs in the 45-minute drive shed from Spokane Valley and 63,115 jobs in the 45-minute transit shed. This indicates that a large majority of jobs are more accessible by driving an automobile rather than taking public transit. 1 These are approximate estimates based on analysis of the following data s ources: US Census LODES database, 2017 and census block geometries, 2010; ECONorthwest. PAGE 4 DRAFT Figure 1. Travel Shed Map, Access to Employment Sources: US Census LODES database, 2017 and census block geometries, 2010; and Spokane Transit Authority database. ECONorthwest Calculations 2.1.2 Who lives in Spokane Valley? SPOKANE VALLEY IS GAINING NEW RESIDENTS. Between 2010 and 2020, Spokane Valley’s population grew 8.6 percent, from 89,755 people to 97,490, a gain of 7,735 new residents. For comparison, the City of Spokane grew by 7 percent or by 14,684 people during the same period. These two cities combined account for 43.6 percent of Spokane County’s population growth of 51,379 people during this time (OFM, 2020). The housing needs assessment showed Spokane Valley’s population between 2010 and 2018 grew by 6,055 people (OFM, 2020). Housing needs vary for different age groups and change over a person’s lifetime. Consequently, it is important to track shifts among the share of different age groups to better comprehend how housing needs change as community demographics fluctuate. Between 2012 and 2018Spokane Valley’s millennial population (25-34 years) almost doubled, growing substantially from 10 percent to 15 percent of the population total from 12,148 to 21,144 persons (U.S. Census ACS PUMS, 2012, 2018). Another growing sector is the senior population which includes persons over 65 years old. During 2012-2018, seniors grew from 13 percent to 15 percent of the total population settling at an estimated total of 20,910 persons, a total similar to the millennial population sector. PAGE 5 DRAFT SPOKANE VALLEY IS BECOMING SLIGHTLY MORE DIVERSE. Spokane Valley’s population has become slightly more diverse, as illustrated in Figure 2. While all race and ethnicity categories increased in total share of population, the share of residents who are Black, indigenous, and persons of color increased more than white households in this period; most Spokane 2 Valley residents (83 percent) identify as white non-Hispanic. Figure 2: Population by Race and Ethnicity, Spokane Valley 100% 3% 5% 5% 7% 90% 80% Hispanic/Latino 70% 60% Some Other Race Alone 50% 87% 83%Asian Alone 40% 30% Black or African American Alone 20% 10%White Alone 0% 20122018 Source: U.S. Census Bureau. (2012, 2018). ACS PUMS 1-Year Data Understanding Area Median Income The U.S. Department of Housing and Urban Development (HUD) calculates affordability and income limits for metro areas and counties across the country, based on the area's Median Family Income (MFI), which is derived from Census data. Since housing needs vary by family size and costs vary by region, HUD also produces Area Median Income (AMI) benchmarks for different family sizes on an annual basis. These benchmarks are used for understanding what different households can afford to pay for housing. In 2018, the Spokane, WA, HUD Metro Area, which includes the City, AMI was $65,200 for a family of four. HUD adjusts the income limits up or down, based on family size (see Figure 3). Figure 3. HUD 2018 Income Limits for Spokane, WA, HUD Metro Fair Market Rent Area Family Size (Number of People) Affordability Level 1 2 3 4 5 6 7 8 30% $13,700 $15,650 $17,600 $19,550 $21,150 $22,700 $24,250 $25,850 50% $22,850 $26,100 $29,350 $32,600 $35,250 $37,850 $40,450 $43,050 60% $27,420 $31,320 $35,220 $39,120 $42,300 $45,420 $48,540 $51,660 80% $36,550 $41,750 $46,950 $52,150 $56,350 $60,500 $64,700 $68,850 100%$45,700 $52,200 $58,700 $65,200 $70,500 $75,700 $80,900 $86,100 Source: https://www.spokanecounty.org/DocumentCenter/View/26421/HUD-2019-MEDIAN-FAMILY-INCOME-LIMITS-effective-6-28- 2019. INCOME COMPARISONS IN SPOKANE COUNTY. Most households in SpokaneValley, 66 percent, earn more than 80 percent of AMI and 34 percent of households earn less than 80 percent of AMI (ACS, 2018). Compared the City of Spokane and to 2 The U.S. Census Bureau considers race and ethnicity as two distinct concepts. The Census applies two categories for ethnicity: Hispanic or Latino and Not Hispanic or Latino. Hispanic/Latino is an ethnicity and not a race, meaning that individuals who identify as Hispanic/Latino may be of any race. The share of the population that identifies as Hispanic/Latino should not be added to percentages for racial categories. PAGE 6 DRAFT 3 Spokane County as a whole, Spokane Valley has the smallest share of households earning below 30 percent of AMI (eight percent) and the highest share of households earning above 100 percent AMI (56 percent). The shares of households in the 30 to 100 percent AMI range is similar across the three jurisdictions (ACS, 2018). Figure4summarizes thisnarrative. Figure 4: Income Distribution Comparison, 2018 City of Spokane Valley 8%10%16%10%56% City of Spokane 13%12%16%9%50% Spokane County 10%11%15%9%54% 0%10%20%30%40%50%60%70%80%90%100% Household Income as a % of AMI 0-30% of AMI30-50% of AMI50-80% of AMI80-100% of AMI100%+ of AMI Source: U.S. Census Bureau (2018). ACS PUMS 1-Year Data. Describing AMI Affordability Levels Affordability levels categorized by income ranges. Figure 5 describes these income ranges by the 2018 Spokane County AMI rate and corresponding income limits for a family of four. Figure 5: Characterization of Affordability Levels Income Description AMI Range Income Range* Monthly Housing Payment Range** Extremely low-income Below 30% under $19,550 $489 or less Very low-income 30 to 50% $19,550- $32,600 $489 to $815 Low-income 50 to 60% $32,600- $39,120 $815 to $978 Moderate-income 60 to 80% $39,120-$52,260 $978 to $1,307 Middle-income 80 to 120% $52,260-$78,240 $1,307 to $1,956 High-income Above 120% above $78,240 More than $1,956 * Based on family of four income (HUD, 2018). ** Assumes that up to 30 percent of income is used for housing. THE PERCENTAGE OF MIDDLE- AND HIGH-INCOME HOUSEHOLDS IN SPOKANE VALLEY IS INCREASING FOR BOTH OWNERS AND RENTERS. Comparing the distribution of owner and renter households over time, as shown in Figure 6, reveals two insights that inform this HAP strategies. First, while the shares of households described as middle- 3 The Spokane County data comprises unincorporated Spokane County and all the incorporated jurisdictions including the City of Spokane and the City of Spokane Valley. PAGE 7 DRAFT income or high-income increased What is Missing-Middle Housing? between 2012 and 2018 there is still Missing-middle housing types bridge a gap between single roughly one third of the households family and more intense multifamily housing. They can generally be described as single-family attached housing units in the City that are described as with two or more units such as duplexes, triplexes, quad homes, moderate-income to extremely low- and multiplexes. Missing-middle housing types also includes income. Production of missing- accessory dwelling units, town homes, backyard homes, and middle housing such as tiny homes, row homes. accessory dwelling units, cottages, In theory, these space efficient housing units can be more townhomes and apartment buildings affordable than other units because they are smaller and should be a focus of the strategies to more energy efficient and they use less land resources. provide new units to house these Providing middle housing expands opportunities for housing that may be lower cost than single family detached housing. families as well as to help preserve These units can be well-integrated into existing neighborhoods existing affordable units. The second and often can be designed to resemble single-family observation is that these missing- detached housing. This housing could provide seniors housing middle home types should be options that would allow for “downsizing” and lower- available for ownership, but the maintenance living and would serve moderate to middle- income households. greater need is for rental units. Figure 6: Income Distribution in Spokane Valley, 2012–2018 Overall 8%10%16%10%56% Renter %17%18%20%11%34% 2018 Owner %4%6%13%10%67% Overall 19%12%46% 13%10% Renter % 21%18%25%8%28% 2012 Owner % 9%6%16%14%55% 0%20%40%60%80%100% Household Income as a % of AMI Less than or equal to 30%30 -50%50-80%80-100%Over 100% Source: U.S. Census Bureau. (2012, 2018). PUMS. Household incomes have increased overall in Spokane Valley over the last decade. Figure 6 shows that the share of households earning 100 percent of AMI or more (including a portion of the middle- income households and all high-income households) increased between 2012 and 2018 overall for both renters and owners from 46 to 56 percent of the total households. Unsurprisingly, this figure also shows that households described as middle or high income consistently tend to be homeowners. Low to moderate income households (households earning below 80 percent AMI) decreased overall for both owners and renters from 42 to 34 percent of the total. INCOMES HAVE INCREASED, BUT MORE SO FOR HOMEOWNERS. Household incomes have increased at a greater rate in Spokane Valley for homeowners than for renters. Figure 7 shows that the median household income for homeowners in Spokane Valley was PAGE 8 DRAFT $77,299 in 2018, whereas the median household income for renters was $38,498. For both household types, this median income is higher than that of households in Spokane County and the City of Spokane. Incomes in Spokane Valley increased at an annual rate of 3.8 percent for homeowners, whereas households that rent saw a 1.9 percent increase per year (PUMS, 2018). For context, median single-family home prices increased at an inflation adjusted annual rate of 5.1 percent between 2012 and 2018 (Spokane County Assessor, 2020) while the average rental price for a two-bedroom unit increased at an inflation adjusted annual rate of 1.5 percent during the same period (CoStar, 2020). Figure 7: Median Household Income, 2012–2018 Median Household RenterIncomeMedian Household OwnerIncome $80,0004.0% $80,0004.0% $70,0003.5% $70,0003.5% $60,0003.0% $60,0003.0% $50,000 2.5% $50,0002.5% $40,0002.0% $40,0002.0% $30,0001.5% $30,0001.5% $20,0001.0% $20,0001.0% $10,0000.5% $10,0000.5% $00.0% $0 0.0% SpokaneCity ofCity of SpokaneCity ofCity of CountySpokaneSpokane CountySpokaneSpokane Valley Valley Source: U.S. Census Bureau (2012, 2018). PUMS. Numbers were adjusted to 2018 inflation values, using the Consumer Price Index. 2.1.3 What are the current housing conditions in Spokane Valley? SPOKANE VALLEY’S HOUSING STOCK IS SIMILAR TO OTHER EDGE CITIES. Spokane Valley’s housing is predominantly single-family detached housing. As of mid- 2020, the majority (66 percent) of Spokane Valley’s 38,730 housing units (Spokane County Assessor, 2020) are single-family detached.Most Spokane Valley residents living in single- family detached housing own their home (86 percent) rather than rent (ACS 1-Year, 2018). An additional 20 percent of the housing units are apartments and condos and only 9 percent of the housing stock is single-family attached (includes duplexes, triplexes, and quad homes). Data source: Spokane County Assessor, 2020. Spokane Valley lacks housing diversity needed to accommodate future demand particularly associated with aging baby boomers and young households forming. The city has a low supply (9%) of “missing- middle” housing or single-family attached housing which allows more seniors to downsize and remain in their community, while also providing more options for millennial households and working families to get a foothold in great neighborhoods. Spokane Valley’s housing stock is relatively new, with nearly one-third built before 1969 and over half built after 1980 (Spokane County Assessor, 2020). PAGE 9 DRAFT Spokane Valley has more homeowners than renters. About 67 percent of occupied units are inhabited by homeowners and 33 percent of occupied units are inhabited by renters as of 2018 (ACS, 2018). SPOKANE VALLEY HAS NOT BEEN PRODUCING ENOUGH HOUSING TO MEET DEMAND. This continual growth has added pressure on a limited supply of housing. From 2010 to 2019, Spokane Valley saw an average of 345 new housing units built per Spokane Valley’s population growth and year, for a total of 3,445 new housing units (Spokane housing development has remained County Assessor, 2020). This unit count includes all steady for most of the decade. From 2010 units, ownership homes and housing units for rent. to 2018, Spokane Valley’s population grew Figure 8 illustrates the housing unit development trends by 7%, adding 6,055 new residents. in Spokane Valley between 2010 and 2019. Figure 8: Number of Units Built in Spokane Valley Per Year, 2010–2019 1,0003,500 3,000 800 Cumulative Unit Delivery 2,500 600 2,000 1,500 400 1,000 Units Delivered Annually 200 500 285145437119625216657220267474 00 2010201120122013201420152016201720182019 AnnualCumulativeAnnual Average (345 units/yr) Source: Spokane County Assessor, 2020. Underproduction is the estimated number of housing units needed to satisfy the housing shortfall over the last decade. Over the last decade, Spokane Valley underproduced housing by approximately 4 1,463 units (ECONorthwest analysis of OFM and PUMS datasets). If too few housing units are constructed relative to the number of new households formed, underproduction occurs and contributes to price increases. Without including current underproduction in calculations of future need, the current mismatch of housing units to numbers of households will continue into the future. 4 Current underproduction of housing was calculated based on the ratio of housing units produced and new households formed over time. The average household size in the City is calculated and converted to a ratio of total housing units to households. This ratio is compared to that of the region as the target ratio. If the City’s ratio is lower, then we calculated the underproduction as the number of units it would have needed to produce over time, to reach the target ratio. PAGE 10 DRAFT A useful way to detect whether the housing supply is meeting the demand is to examine vacancy rates. On average during the last decade, the vacancy rate was 5.4 percent for 2-bedroom apartments in the City. This is a standard rate of vacancy, indicating that the supply for this product type should be adequate to meet demand. However, nearby, the City of Spokane’s vacancy rate was an average of 2.7 percentfor 2-bedroom apartments over the last decade. This low rate is below the 5.0 percent standard, indicating an inadequate supply to satisfy demand. Vacancy rate trends should be monitored to track housing supply limitations to help build a more comprehensive understanding of emerging housing needs. SPOKANE VALLEY HOME PRICES AND RENTS ARE HIGHER THAN THOSE IN THE COUNTY AND THE CITY OF SPOKANE. When demand for new housing exceeds the supply of new housing, the market tightens and prices rise. Supply and demand imbalances and subsequent price increases can also be exacerbated by rapid regional job growth and too few newly created housing units to meet the demand for in migration from the job growth. There has not been a substantial spike in employment in Spokane County; however, there has been an increase in in-migration with more households moving to the area from high-cost cities in search of a lower cost of living and the improved quality of life offered in Spokane Valley and the Spokane region. Between 2010 and 2020, Spokane Valley’s average What might an owner’s monthly two-bedroom rent increased 15 percent, or an payment be on a $300,000 home? average of 1.4 percent annualized, while median The payment on a $300,000 home in Spokane sales prices increased 48 percent, or an average of Valley would be about $1,500 per month if 4.0 percent annualized. In 2020, the average rent financed in 2020. This assumes a 20 percent for a two-bedroom apartment was $1,131 per down payment, a 3.8 percent interest, and $3,500 in taxes based on actual recent comps. month, while the median sales price for ownership housing was $300,000. Figure 9 illustrates this pricing progression. During this period, the average annual rate of inflation was 1.7 percent. The annual rate of change for an average two-bedroom apartment was in-line with inflation; however, home prices increased at a rate over three times inflation. Median household incomes in Spokane Valley increased by 3.8 percent per year for owners and 1.9 percent per year percent for renters between 2012 and 2018 (ACS, 2018). Figure 9: Spokane Valley Housing Costs, 2010and 2020 Annualized Percent 2010 2020 Change Average Rent $983 $1,131 1.4% Median Sales Price $202,461$300,000 4.0% Source: CoStar, Spokane County Assessor, 2020. Numbers were adjusted to 2020 inflation values, using the Consumer Price Index By comparison, two-bedroom rent increased by 13 percent and 11 percent in Spokane County and in the City of Spokane, respectively, between 2010 and 2020. The current average two-bedroom rent in Spokane County is $1,094 per month and $1,081 in the City of Spokane. The 2020 median home prices in Spokane County were $255,900 and $275,000 in the City of Spokane (CoStar, Spokane PAGE 11 DRAFT County Assessor, 2020). The escalating cost of housing, especially for those wanting to buy a home, is a top concern for people finding very few options of housing affordable at their income level. NEARLY HALF OF SPOKANE VALLEY’S RENTER HOUSEHOLDS ARE COST BURDENED AND THIS COST BURDENING DISPORTIONATELY IMPACTS LOWER INCOME HOUSEHOLDS. A typical standard used to determine housing affordability is that a household should pay no more than a certain percentage of gross household income for housing, including payments and interest or rent, utilities, and insurance. HUD’s guidelines indicate that households paying more than 30 percent of their income on housing and utilities experience “cost burden,” and households paying more than 50 percent of their income on housing and utilities experience “severe cost burden.” Without enough rent-restricted and regulated affordable housing, many low-income households end up paying more than they can afford on housing. In Spokane Valley, an estimated 48 percent of renter households are cost burdened, and 25 percent are severely cost burdened (ACS, 2018). Recent figures (2018) show that lower income households and renters are paying a much greater share of their income on housing. In fact, those most cost burdened tend to be extremely low-income and very low-income (earning less than Households earning 50 percent or less of AMI) are A Note on COVID-19 disproportionally impacted. Nearly 6,500 Another factor affecting housing is the COVID-19 pandemic. Since its emergence, the pandemic Spokane Valley households earning 50 percent or has slowed the production of housing in many less than AMI out of the 7,600 total households regions and due to growing remote work in this group are cost burdened, while practices, commuting rates have diminished and approximately 4,350 households in this income housing preferences are shifting. In addition, the pandemic has impacted the ability to pay for group are severely burdened (ACS, 2018). The housing consistently, which will likely exacerbate need for more affordable housing has expanded housing availability and stability. These types of particularly for low to moderate-income owner trends should be monitored as conditions and households and low-to moderate-income renter communities adjust. households (less than 80% AMI). Low-income renters earning less than 50% AMI tend to be more severely cost burdened. This may mean trade-offs 5 must be made between housing and paying for other essentials, such as food, clothing, and healthcare. THERE IS A LIMITED SUPPLY OF RENT-RESTRICTED AFFORDABLE HOUSING AND LOW-COST MARKET RENTALS. 6 Spokane Valley has approximately 1,663 units of rent-restricted affordable housing for households earning less than 60 percentof AMI (ECONorthwest analysis of HUD, Spokane Housing Authority, 7 and Washington State Housing Finance Commission data, 2020). 5 Cost burdening for owner-occupied households is not terribly common because mortgage lenders typically ensure that a household can pay its debt obligations before signing off on a loan, but it can occur when a household sees its income decline while still paying a mortgage. Households with incomes over 100% AMI are less burdened overall since their larger income will go farther to cover non-housing expenses. Cost burden does not consider accumulated wealth and assets. 6 Rent-restircted affordable housing is income- or rent-restricted to ensure that the housing is occupied by households earning a certain income. Rents for such units are set so as to be affordable to those income levels. Rent restrictions are set according to the types of funding used to develop the housing, such as the Low-Income Housing Tax Credit, or HUD funding,. The City does not regulate or influence the rates for these units. Most rent- restricted affordable housing is restricted to be affordable to households earning under 60 percent MFI, but these restrictions vary. 7 The data available for this section describes housing affordable to 60 percent of AMI or lower and in other sections housing affordability is described in different AMI categories. This is due to differences between various data sources. Household affordability information provided in US Census ACS PAGE 12 DRAFT The map in Figure 10 showswhere in Spokane Valley these units are located. Given the limited supply of these units, Spokane Valley’s population at this income level must compete for lower-cost / lower- amenity unregulated market rate housing. Figure 10: Rent-Restricted Unit Location Map, Like many places, Spokane Valley Spokane Valley does not have enough rent-restricted affordable housing units, which are costly to build and operate. As a result, many low-income households live in low-cost market (unregulated) housing units (often called naturally occurring affordable housing, or NOAHs). There is no official definition of low-cost market rentals or NOAH units. They can be defined by condition/age/and amenity level, or by rent price (typically below 80 percent of AMI). The common factor is that they are affordable to low- income households, but their rents are unregulated by a funding or financing program. Source: ECONorthwest analysis of HUD, Spokane Housing Authority, and Washington State Housing Finance Commission data, 2020. 2.1.4 Future Housing Needs TO ACCOMMODATE NEW RESIDENTS, DEVELOPERS IN SPOKANE VALLEY WILL NEED TO PRODUCE HOUSING AT A SLIGHTLY FASTER RATE THAN THEY HAVE IN THE PAST. The OFM medium population forecast indicates that by 2037, Spokane Valley’s population will have risen to 109,913. Based on Spokane Valley’s population estimate for 2018 (95,810 people), Spokane Valley is forecast to grow by 14,103 people by 2037 (14.7 percent), at an annual growth rate of 0.7 percent (ECONorthwest calculation; OFM, 2019 data). Spokane Valley is forecasted to grow at a rate similar to past rates, and this growth will continue to drive future demand for housing in the city over the planning period. To accommodate expected population growth through 2037 Spokane Valley will have to produce 6,660 new housing units of all types, sizes, and affordability levels (ECONorthwest analysis). This translates to 351 housing units per year. Between 2010 and 2019, an average of 345 new housing units were built in Spokane Valley each year. This means that slightly more housing would need to be built per year than the average produced from 2010 and 2019. Spokane Valley should continue to support robust housing growth and advance strategies that support a diversity of housing types and affordability levels. and PUMs analysis is not available at the 60 precent level while HUD helps to fund affordable housing developments that provide units to households earning less than 60 percent of AMI. PAGE 13 DRAFT If units are allocated based on recent income distribution To meet future housing needs the trends, over half of Spokane Valley’s needed housing units preservation of NOAH units that may (3,760 units) should be for households earning at least 100 be displaced because of new development is important for helping percent of AMI, and another 10 percent (686 units) targeted to house very low- to moderate- for households at above 80 percent AMI. The remaining 33 income households. Strategies in this percent, or 2,214 housing units, needed through 2037 HAP also need to support the creation should be targeted for households earning less than 80 of rent restricted affordable housing units for extremely low- and very low- percent of AMI. Figure 11 provides the complete income households through public distribution of housing units needed among the five AMI agency support and assistance ranges. Overall, a healthy housing market should havea programs since this type of housing is variety of housing types at different price points that are becoming increasingly difficult through the private market. affordable to a range of different household incomes. Figure 11. Housing Units Needed in Spokane Valley by AMI, 2037 Number of UnitsNeed Percent of Total Units AMI through 2037 Needed 0-30% 5508% 30-50% 6259% 50-80% 1,039 16% 80-100% 68610% 100%+3,760 56% Total 6,660 100% Sources: ECONorthwest calculation; OFM, 2019; U.S. Census Bureau, 2018 PUMS. The housing needs analysis shows a mismatch in the type of housing units available. Around 44 percent of all the City households need housing priced below 100 percent of the AMI, yet this housing is inadequate since only 34 percent of the current housing stock includes housing types affordable for incomes below the AMI, such as less expensive detached single-family homes (ADUs, manufactured homes, cottage), attached single-family homes (duplexes and townhomes and multifamily developments). Figure 12 illustrates the type of home a household may afford based on its income. The information in Figure 12, together with Figure 11 above inform the strategies recommended in this HAP. PAGE 14 DRAFT Figure 12: Housing Types and Financial Attainability Source: ECONorthwest. Note: All values are in 2019 inflation-adjusted dollars. 2.2 Summary of Policy and Regulatory Assessment A policy and regulatory assessment identified existing housing goals, policies, and strategies from the 2017 Spokane Valley Comprehensive Plan as well as housing regulations, programs,and incentives currently available to encourage greater housing supply and the development of affordable housing in Spokane Valley. The information was used alongside the housing needs assessment and input from community members and stakeholders to develop strategy and policy options that could be used to meet housing needs within Spokane Valley. 2.2.1 Policy Review In its ComprehensivePlan, Spokane Valleyidentified three goals and four priorities specifically related to housing. Other elements of the Comprehensive Plan, particularly the Land Use element, include several other goals and policies related to housing. The summary of housing-related policies and strategies is organized around four housing themes identified in the Comprehensive Plan: PAGE 15 DRAFT Ensure a Range of Housing Options for Residents: During the development of the Comprehensive Plan, community members identified a need for a greater diversity of housing types to serve people at all income levels and stages of life. A goal that exemplifies this theme is “allow for a broad range of housing opportunities to meet the needs of the community.” Key Action taken: In 2017, Spokane Valley implemented new regulations that allows missing-middle housing types such as accessory dwelling unit (ADUs); cottage housing; duplexes; manufactured homes, both on individual lots and in-home parks; and townhouses. In 2020 the City modified the Spokane Valley Municipal Code (SVMC) to establish a new zoning district, R-4 Single-Family Residential Urban that allows the full range of missing-middle housing products and focused where in the City townhomes and cottages maybe developed. Improve Housing Affordability: The current Comprehensive Plan includes a goal to allow for a diversity of housing options that are affordable to households at all income levels. One such goal is to “enable the development of affordable housing for all income levels.” Key Action taken: In 2020, Spokane Valley adopted a new ordinance to authorize a sales and use tax credit for affordable and supportive housing, which is expected to generate approximately $178,000 per year. Spokane Valley has not yet designated a specific use for such revenues. Enhance Distinctive Neighborhood Character/Support Neighborhood Commercial:Several goals and policies in the Comprehensive Plan encourage neighborhood conveniences and mixed-use residential development. An example is Housing Element-Goal 3, “Allow convenient access to daily goods and services in Spokane Valley’s neighborhoods.” Key Action taken: Spokane Valley modified its zoning regulations in 2020 to create a new Single-Family Residential Urban (R-4) zoning district that permits more diverse housing development within close proximity to public transportation and services. Encourage the Creation of Mixed-Use Destinations: The Comprehensive Plan cites the Kendall Yards area of Spokane as an example of a mixed-use destination development that combines housing, retail, and amenities in a walkable community connected to transit. Land Use Element Goal 3 calls for Spokane Valley to “support the transformation of commercial, industrial, and mixed-use areas into accessible districts that attract economic activity.” Key Action taken: Spokane Valley’s mixed-use zones (MU and Corridor Mixed-Use \[CMU\[) allow for concurrent development of residential and commercial space. These uses may be developed side by side or on top of each other, with the commercial space on the ground floor. A detailed review of the existing policies, actions taken by Spokane Valley to date, and an evaluation of these actions is available in Appendix C. PAGE 16 DRAFT 2.2.2 Regulatory Review A detailed review of Spokane Valley’s existing zoning and permit procedures helped to identify where housing development is currently allowed and how it is permitted. Spokane Valley has five residential zones (R-1, R-2, R-3, R-4, and MFR) that are specifically intended to support residential development; however, certain residential development is also permitted in mixed use zones and nonresidential zones. The residential zoning districts range from Single-Family Residential Estate (R-1), the least dense zone, which allows for lots of at least 40,000 square feet and one dwelling unit per acre (du/ac); to Multifamily Residential (MFR), which has no minimum lot size and allows up to 22 du/ac. No density bonuses are currently allowed, except in Planned Residential Developments. The City has placed a moratorium on new Planned Residential Developments and related regulations are currently under review. Appendix C includes a detailed review of dimensional requirements and parking standards for each zoning district. Spokane Valley has three main permit application types, which correspond to increasing levels of review procedures. For example, Type I permits generally have limited public notice and are administratively approved, while Type III permits require extensive public notice and are subject to a public hearing and approval by a neutral Hearing Examiner. Most residential development types fall under Type I or II application review, with the exception of cottage housing, industrial ADU development, and subdivisions, which require the more intensive Type III review. In addition, Spokane Valley has adopted the maximum State Environmental Policy Act (SEPA)flexible exemption thresholds so that multifamily developments of 60 units or fewer are not required to go through SEPA review. 2.2.3 Barriers BARRIERS TO DEVELOPMENT OF EXISTING HOUSING TYPES The housing development process is defined in the SVMC and in practice by Spokane Valley staff. There is sufficient development capacity on land in Spokane Valley to support a range of new housing, and the zoning regulations provide flexibility for developers to deliver housing at a pace to meet the identified housing needs assessment objective of at least 6,600 housing units by 2037, or around 351 units per year. Spokane Valley is primarily a large-lot, The community was asked... single-family community. While residents How can the City of Spokane Valley improve housing for have voiced appreciation for those our community? “More cottages and duplexes” characteristics, a survey conducted for this project identified a desire for more housing “More housing options such as condos and townhouses.” choices, including townhomes, ADUs, and “More auxiliary housing, cottages on homeowner lots.” cottages. Spokane Valley should continue “By not regulating so tightly the ability to put to support housing growth and advance ADUs on properties.” strategies in support of housing growth for “Allow homeowners to build ADUs, cottages and co- a diversity of housing types and housing.” affordability levels to meet its target. PAGE 17 DRAFT Several barriers impact the delivery of housing in general and specific types of housing such as the allowed maximum density in specific zones, open space requirements, and allowed building height for multi-family development are areas where the City may improve the quantity, quality, and range of new housing development. Other barriers identified are beyond Spokane Valley’s control, such as the market’s acceptance of different housing types or appeals of project from residents. AFFORDABLE HOUSING FUNDING AND INCENTIVES While its zoning regulations allow flexibility in the housing types permitted, Spokane Valley currently has limited incentives to support the development of a range of housing types that are attainable for a broad variety of household incomes. The policy and regulatory review found that Spokane Valley should explore additional funding mechanisms and incentives to encourage affordable housing development. Recommended strategies are discussed in Section 3 of this HAP. 2.3 Summary of Public Engagement MFA led a robust public engagement process to gather community input to inform the HAP. The purpose of the community engagement is to connect with and listen to residents, workers, businesses, nonprofit organizations, service providers, and other key stakeholders. The community’s participation in this process includes qualitative, anecdotal input as well as quantitative input via a survey to develop and support the recommendations offered in the HAP. Below is a summary of the survey results and the interviews. In addition to public engagement efforts taken during the development of the HAP, additional public engagement will occurred as part of the adoption process. 2.3.1 Community Engagement Approach The outreach process was predicated on the need to conduct engagement reflecting the Spokane Valley community and to help illuminate the City’s housing opportunities and challenges. Community input helped shape the direction of the HAP’s strategies and recommendations. Draft strategies and recommendations were then reviewed by staff, and the final HAP, once prepared, will be distributed to the public for further comment prior to adoption. A list of the outreach tactics used in development of the HAP is summarized in Figure 13. Conducting community outreach amidst the COVID-19 pandemic presented unique challenges. All community outreach that has been conducted to inform the HAP was held by video or phone calls with people who had access to technology and via a public survey. Because of the challenge of scheduling and organizing effective focus groups, we concentrated our outreach efforts on a set of one-on-one interviews with a diverse group of community stakeholders and developers. Figure 13: List of Outreach Tactics Month Outreach Tactics Summer 2020 Community engagement plan Project web page, materials, and “on-hold” message for the City of Spokane Valley general phone line Stakeholder interviews Community and partner update describing the HAP purpose, need, and process PAGE 18 DRAFT Month Outreach Tactics Fall 2020 Community survey #1 about the current state of housing and housing needs (Survey was live 9/21–10/19) Website updates regarding project status Winter 2020–21 City magazine article about the HAP (quarterly magazine mailed to over 50,000 residents in November 2020) Website updates regarding project status Community and partner update on project status Appendix D contains the complete summary of the community engagement process, including goals, approach, and methodology for identified stakeholder input. 2.3.2 Public Engagement Results ONLINE SURVEY In September and October 2020, an online public survey was conducted. A total of 124 respondents completed the survey. The Spokane Valley community was well represented, and demographics of those that took the survey aligned closely to the makeup of the City.Key findings from the survey are summarized below. Appendix Dcontains additional information on the survey. Owners and renters in Spokane Valley: The survey asked whether the respondents owned or rented their homes. All respondents answered this question and 75 percent were owners—56 percent owned with a mortgage and 19 percent owned free and clear. Renters accounted for 23 percentof the responses. The other three respondents either occupied their unit without payment of rent or they did not have stable housing. Barriers to renting in Spokane Valley: Only 25 of the 124 respondents (20 percent) identified as renters. This question allowed respondents to select more than one choice. The 25 respondents provided a total of 31 responses. Of these 31 responses, 77 percent said finding affordable housing in the city was a barrier to renting. Challenges included not being able to find affordable housing (61 percent identified this as a barrier), 10 percent identified as a barrier not being able to find housing that accepted housing vouchers, and six percent said past evictions, or no ADA-available units was a barrier. The remaining 23 percent of renters did not experience any barriers to renting. Barriers to purchasing a home in Spokane Valley: This question asked if respondents had recently tried to buy or bought a home and allowed respondents to select more than one answer. The 102 responses include renters and homeowners. Of this total, 23 percent said affordability was a barrier, and 18 percent could not afford a down payment. Others noted difficulty finding the right type of housing, being outbid, or not finding a place in the location they wanted. Less than half of the respondents did not encounter any barriers (45 percent, or 29 of 64). Types of housing in Spokane Valley: Of the 124 respondents, 109 indicated the type of housing that they currently live in. Single-family homes accounted for 80 percent of where respondents live, while the next most common housing type was multifamily homes at 13 percent. PAGE 19 DRAFT Favored housing types for Spokane Valley: Respondents were also asked what type of housing they would like to live in. Of the 124 respondents 107 provided at least one answer. Respondents could select more than one housing type and a total of 159 housing types were selected. Single-family homes were the most desired housing type at 60 percent of responses, though nearly all the respondents (90 percent) included single-family homes as one of their choices. The next most favored were: Cottages: 16 percent of the total responses selected this choice. Townhomes: Nine percent of the total responses selected this choice. Duplex: Seven percent of the total responses selected this choice. Housing options in the greatest need: Respondents were asked what kind of housing options are in greatest need in Spokane Valley. Of the 124 respondents, 93 provided at least one answer. Respondents could select more than one type of housing and a total of 206 responses were provided. Of the 93 respondents, 73 percent felt more affordable ownership housing options were in the greatest need. The other two most frequently selected needs were the desire for more affordable housing for seniors, with 48 percent selecting this choice, and the desire for more flexibility for single-family homeowners to build accessory dwelling units, such as backyard cottages, with 44 percent selecting this choice. The survey also asked respondents to address three open-ended questions. The questions and summary of the responses are below. Are there any issues or challenges that impact quality of life in your neighborhood? Respondentsprovided atotal of 65 comments. Responses ranged from lack of affordable housing to pesky neighbors. Respondents noted that higher drug, crime, and homelessness areas are often also lower income housing areas. The desire for recreation and parks was mentioned several times. How can the City of Spokane Valley improve housing for our community? Respondents provided a total of 89 comments. The comments generally noted either the need to encourage the development of more affordable housing and to help promote more housing choices. What is the primary reason you chose to live in Spokane Valley? Respondents provided a total of 92 comments. Comments indicated that apart from train traffic, Spokane Valley is a quiet community with less vehicle traffic and fewer challenges associated with bigger cities. Good schools and great quality of life were noted many times, as well as ease of access to Interstate 90. ONE-ON-ONE INTERVIEW SUMMARY The purpose of the one-on-one interviews was to discern and understand the current and historical housing situation of Spokane Valleythrough intentional discussion and analysis of the lived and professional experiences from local developers and community leaders. Below is a summary of feedback; Appendix D presents more details and supporting recommendations from stakeholders. PAGE 20 DRAFT Development Process Input from the developers interviewed was that development process in Spokane Valley is working efficiently for permitting and constructing new single-family and multifamily housing. Interviewees indicated positive experiences working with building officials and Spokane Valley staff navigating the permit process. The fee schedules are in line with the market. However, those involved with developing affordable housing noted there would be an added benefit to an otherwise challenging development pro forma if the City reduced or waived fees for affordable housing projects. Competitive and Limited Affordable Housing Funding Sources With regards to affordable housing, federal, state, and local funds are limited and highly competitive and there is limited funding available for distribution to projects annually. It was noted that there are only two qualified census tracts in the city, 117.02 and 118.00. Affordable housing developments in qualified census tracts that apply for low-income housing tax credit funding receive a boost in the amount of tax credits they can receive. These tax credits are important for making regulated affordable housing projects feasible. Interviewees noted the benefits that a City managed housing fund supported through a property tax levy for affordable housing and/or sales and use tax fund for affordable and supportive housing. Opportunities to Encourage Housing Development Several interviewees noted that there is very limited inventory for starter homes and the gap in missing- middle housing in Spokane Valley is real. The following summarizes the range of ideas offered based on the interviewees’ professional experience and their conversations with the community: Low-Income Households Rent deposits and documentation requirements can be hurdles for portions of the population. Consider programs or policies that address this hurdle. Down payment assistance for first time home buyers– either through a City fund or a community partner. Acknowledge equity and race in the City’s Comprehensive Plan to position the City to address housing equity. Limited equity co-ops are a means to create wealth and home ownership for long-term tenants. Challenges include patient investors and gap financing. The other model often noted is shared equity. These programs do not require City intervention. The city may provide resources and information, and/or provide financial support for limited equity co-ops if it creates a housing fund. Programs and Incentives Provide housing around state and federally supported transportation investments. Planned Action Environmental Impact Statements may provide additional incentives for developing housing in these areas by reducing the project-level permitting process. Implement a multifamily tax exemption program. PAGE 21 DRAFT Offer nonprofits the first right of refusal to develop affordable housing units on City- owned properties or properties with a property tax lien. Brownfields may provide land opportunities not sought by market-rate developers. Outreach and Partnerships A regional communications campaign dispelling housing myths and showing the positive benefits of healthy homes. Partner with neighborhood groups or support the creation of one that is focused on Spokane Valley. SNAP (Spokane Neighborhood Action Partners) is a model. Seek partnerships with private entities seeking philanthropic endeavors. A local example is a project in northeast Spokane that was built by Spokane Housing Ventures in partnership with Empire Health Foundation. Traditional affordable housing funding sources were used as was support from the foundation. Threats to Housing Development and Preservation of Affordable Units Several interviewees mentioned threats to housing development and the need to preserve affordable units. A range of observations and ideas were offered based on the interviewees’ professional experience and their many conversations with the community. Lumber prices have gone up by more than 120 percent over the past year. There is not anything the City can do about this, but these increased costsdirectly impact housing prices. Labor shortages impact development costs. It was noted that encouraging more trade jobs through apprenticeship programs or partnerships could help grow the workforcethat may reduce labor availability and related development cost impacts. Rent-restricted developments that need rehabilitation could be an area of focus. The rehabilitation costs require debt, and the financial package may require higher incomes. The unintended consequence is a loss of units that serve the 30 percent or less AMI households. One developer shared about a single-family subdivision that was subject to public comment and SEPA review being held up because of protest from nearby residents despite complying with local code. External Forces Driving Developers from Spokane County Developers that have been active in Spokane County indicated that they are seeking development opportunities in northern Idaho where the housing market is similar but where there is significantly less state regulation. These observations are for information and context. The City has limited influence to improve these identified conditions. Interviewees noted the diminishing availability of large tracks of unimproved land in Washington and the increasing cost of land relative to Idaho as driving forces. There was PAGE 22 DRAFT also a strong desire to expand the Urban Growth Boundary to provide more land to develop housing. Several interviewees cited that the energy code revisions adopted by Washington will add costs to home development. These measures, which take effect in 2021, increase development costs which are passed through to the home buyer. Finally, Washington state’s condominium laws create a disincentive to develop this type of attainable housing due to insurance requirements. Condominium law reform is needed to encourage development of higher density condominium buildings that may offer affordable home ownership options. PRE HAP-ADOPTION OUTREACH Community input was used to shape the direction of the HAP’s strategies and recommendations. Draft strategies and recommendations were then reviewed by staff, and the final HAP, once prepared, will be posted on the HAP project web page (www.spokanevalley.org/HAP), distributed to the public for further comment, and refined based on feedback prior to adoption. 2.4 Displacement Risk Analysis Displacement occurs when a household is forced to relocate because of changes in the housing market, either because their housing is being redeveloped or undergoing major renovations or because their housing costs are increasing to beyond what they can afford. With regional housing prices escalating and new housing development taking place, some existing residents in Spokane Valley may be at risk for displacement. The overarching intent of examining displacement risk is to help Spokane Valley proactively identify residents who may be at risk and help inform strategies for preventing and minimizing displacement. This analysis of socioeconomic and demographic displacement risk was modeled after the Puget Sound Regional Council’s Displacement Risk Mapping Tool and is based off a method developed by ECONorthwest. Six variables that can highlight areas where households are most susceptible to displacement were evaluated at the block group level. The evaluated variables were: Percent of population that is a race other than non-Hispanic white Percent of households that speak a language other than English at home Percent of population under 25 who lack a bachelor’s degree Percent of households that are renters Percent of households paying more than 30 percent of gross income on housing Per capita income These factors include renter households, low-income households, and households that are more likely to experience housing discrimination (including communities of color, seniors, and other marginalized (populations). PAGE 23 DRAFT 2.4.1 Types of Displacement There are typically three types of displacement referred to as economic, direct, and cultural displacement (ECONorthwest research). Economic or indirect displacement. Economic displacement Low-income households can occur if new development or redevelopment in an area rents are at high risk of economic displacement, or sells at higher price points that encourage owners of existing as they have fewer units to increase rents, and these increases exceed what existing choices about where tenants can afford. The effects of (re)development renting at they can afford to live. market rates may spill over to lower-cost rental units, causing rents to rise and potentially displacing existing residents. Economic displacement can happen without new development or redevelopment when high demand and low housing supply push prices up. Economic insecurity and displacement are a very important issue for existing communities, but they are difficult to measure quantitatively. Physical or direct displacement. Physical In theory, any type of household could displacement occurs if existing housing is torn be at risk of physical displacement due to a new development demolishing down for redevelopment and existing tenants are their current housing. But in reality, low- displaced. In some cases, public programs could income households, households of encourage displacement by incenting a developer color, immigrant households, and other to rehabilitate or replace older, low-cost housing marginalized populations are at higher risk of physical displacement. Wealthy (unregulated affordable housing) with newer, or “powerful” households are at lower higher-priced units. This could lead to the direct risk of direct displacement, as they may displacement of existing residents, who may not be not live in areas experiencing new able to afford the higher rents in the new development, and they may hold sway development. over decision makers or otherwise know how to exert influence in the process. Cultural displacement. Cultural displacement Marginalized communities—be occurs when people move because their neighbors and they low-income, a specific race or ethnicity, or another culturally relevant businesses and institutions have left the group of people—are at higher area. The presence (or absence) of these cultural assets risk of cultural displacement can influence racial or ethnic minority households, more than dominant communities. than broader populations, in their decisions about where When businesses and housing that serve these communities to live. While this is difficult to measure quantitatively, and leave or are removed, people one could consider whether these are “choices” or can feel pushed out of their whether this is “forced” displacement, it is an important neighborhoods. effect that can have broad equity implications beyond physical or economic displacement alone. Cultural displacement can also include business displacement. 2.4.2 Areas with Displacement Risk Figure 14 shows the results of the socioeconomic and demographic variables identified in section 2.4 that have been used to measure displacement risk. The layering of socioeconomic characteristics for each block group in Spokane Valley shows the neighborhoods that have the highest risk for all three types of displacement. Seventeen of the 64 Census block groups are identified as high vulnerability PAGE 24 DRAFT and 31 are identified as medium vulnerability. Of the total population that comprises these block groups, 27 percent is in a high-vulnerability block group and 46 percent is in a medium-vulnerability block group. Figure 14: Displacement Risk in Spokane Valley by Block Group Legend Source: U.S. Census Bureau (2018). ACS. More conversations and analysis are needed to truly understand displacement risk. A deeper dive into economic displacement resulting from the spillover of new development requires a robust analysis of new and existing rent trends, which is beyond the scope of this work. In addition, measuring cultural displacement is difficult, and not quantifiable from data. It requires qualitative information from in- person engagement with people living near new development. When the City considers land use changes and planning projects it should track, monitor, and engage intentionally with high vulnerability areas. 2.5 Development Feasibility Analysis To inform recommendations about new and revised development incentive programs that can support more housing, including more affordable housing, development (or financial) feasibility was analyzed by ECONorthwest using several housing prototypes and market data unique to submarkets and different development types across Spokane Valley. PAGE 25 DRAFT This development feasibility sensitivity analysis Policy Evaluation and helps identify regulatory and program Financial Feasibility recommendations that would most effectively To compare development feasibility and the advance Spokane Valley’s goals of creating new impact of policy options across different housing to meet forecast demand and growth, development types, ECONorthwest used a common method to identify economic creating a variety of housing types at different price feasibility called a residual land value analysis. points to meet the needs of current and future Residual land value is an estimate of what a residents. The results of the sensitivity tests are developer would be able to pay for land given summarized in the following sections and help to ty’s income from rental or sales the proper revenue, the cost to build as well as any cost to inform recommendations for changes to Spokane operate the building, and the investment returns Valley’s housing programs and development code. needed to attract capital for the project. In Potential regulatory modifications and programs other words, it is the budget that developers tested herein were informed by the regulatory have remaining for land after all the other analysis. Appendix E provides more detail on this development constraints have been analyzed. analysis, along with a summary of assumptions. A few of the housing strategies recommended in this HAPto encourage more housing variety and housing supply include modifications to existing development code as wella recommendation for the City to consider the adoption of a multifamily tax exemption (MFTE) program. Code modifications and the potential addition of MFTE program incentives were analyzed to evaluate their effectiveness in improving the likelihood of development of townhomes and multifamily apartments. A development feasibility analysis tests the impact that various changes to development standards and incentive programs have on market-realistic development examples called prototypes. 2.5.1 Analysis Overview The purpose of this analysis is to examine a set of key program changes and policy levers that can help “tip” project feasibility for the MFTE program and regulatory changes in Spokane Valley. This section describes the findings from evaluating a set of key planning tools, specifically the MFTE and regulatory changes—including modifications to the allowed density in certain zones and changes to other development standards. These planning tools were selected for their potential to boost housing production, especially housing priced for low- to middle-income households. MFTE: The MFTE allows a local jurisdiction to incentivize diverse housing options in urban centers lacking in housing choices or workforce housing units by providing taxing exemptions or credits for developers. Essentially this program supports increased housing availability, possibly including affordable units, largely in mixed-income developments conveniently located in urban centers. Chapter 84.14 RCW outlines the existing requirements for implementing a MFTE program. This program exempts eligible new construction or rehabilitated housing from paying property taxes for either an eight-year or a 12-year period. Only projects with four or more rental units are eligible for either the eight- or 12-year exemption, and only property owners who commit to renting or selling at least 20 percent of these units to low- and moderate-income households—earning less than 80 percent of the AMI—are eligible for the 12-year exemption. Spokane Valley currently does not have an established MFTE program. Additional detail on the MFTE program is provided in Appendix E. PAGE 26 DRAFT MFTE Testing Parameters: Test out the addition of a MFTE program offering a 12-year tax exemption that would require that at least 20 percent of the units be set aside for households earning 80 percent of the AMI or less. In Spokane County, the AMI for a four-person household was $77,400 in 2020. Two ways that this program was tested were: MFTE program without any increase in residential density in MFR zones. MFTE program with an increase in allowed residential density up to 40 du/ac in MFR zones compared to the 22 du/ac that is allowed under the current regulations. Density and Development Standards: The density of residential buildings is limitedby the maximum density allowances that the SVMC sets for each zone. Density allowances differ by zone and sometimes are specific to the type of residential building. Residential density is important for housing development because it determines the number of dwelling units that can be built on a parcel. Minimum lot sizes can also influence residential development, since they can prevent development on lots below a certain size. The number and size of housing units that can be built on a parcel is also determined by requirements for nonresidential uses or areas to be set aside and not developed. Open- space requirements (as well as setbacks and minimum landscape requirements) limit the residential building size on a parcel. The size of the building can also be limited by maximum lot coverage, which determines the largest share of a parcel that a building can occupy. Residential density on a development site can increase by modifying standards affecting the horizontal aspects of a project (i.e., building footprints via setback and open space regulatory changes) or standards influencing the vertical profile of a project (i.e., the maximum building height). Development Prototypes Tested: Three prototypes are evaluated in this feasibility analysis; two types of townhomes and garden style apartments. The financial feasibility findings would generally track with other similar missing-middle product types such as duplexes and cottages. Townhomes are side-by-side- attached single family housing types that are oftentimes associated with fee simple development and small lot sizes. Townhomes can also be built as attached single family condominium housing on larger parcels. 3-story townhomes on a 0.3-acre lot. Townhomes are 2-bedroom or 3-bedroom units with about 1,400 square feet (sf) to 1,700 sf of net floor area, sharing walls with neighboring units, a one-car garage on the ground floor, and a driveway that can function as an additional parking stall. They are assumed to sell at about $421,000 per unit on average. 3-story townhomes on a 1.0-acre lot. These townhomes are the same as above, but they are laid out on two rows and share a private alleyway. They are assumed to sell at about $429,000 per unit on average. Garden style apartments are generally characterized as three-story wood frame construction multifamily rentals. PAGE 27 DRAFT For this analysis ECONorthwest Figure 15: Garden-Style Apartment evaluated 3-story, garden-style Example apartments on a 2.5-acre lot. Apartments have a mix of various sizes ranging from 600 sf for a studio unit to 1,300 sf for a 3-bedroom unit. Residents and their guests have access to surface parking and a shared lobby or common space area. The average rent is assumed to be $1,400 per month. An example image of a garden-style apartment is show in Figure 15. 2.5.2 Summary of Development Feasibility Findings Below is a thematic overview of the findings from the development feasibility assessment. For more detail on the analysis, assumptions, and dollar values of the assessment results, please refer to Appendix E. Based on existing development standards and land prices in Spokane Valley, the townhome prototype has limited feasibility in the R-4 zone and three-story garden-style apartments are not feasible in the MFR zone, given current land prices. The value of new development is limited by development standards that restrict the scale of development possible on a parcel. Increasing density allowances is an effective way to encourage development of townhomes and garden-style apartments in Spokane Valley. For garden-style apartments, the 12-year MFTE also makes projects more cost-effective and feasible, but it is not as impactful as increasing density allowances to 40 du/ac. The development prototypes that tested policy changes included townhomes and apartments at various densities. However, the development feasibility of other missing- middle housing types such as duplexes and cottages would also benefit from these density increases. Decreasing open-space requirements, increasing maximum lot coverage, or increasing maximum building height is unlikely to have any meaningful effect on housing development in the near future. PAGE 28 UBC$5 DRAFT 3 HOUSING STRATEGY RECOMMENDATIONS The strategy recommendations advanced in this HAP were informed by public engagement, data analysis, review of relevant policies and planning documents, staff input, and development feasibility. These recommendations are intended to be options for Spokane Valley that will, if implemented, provide tools to increase housing supply, increase variety of housing types, and/or increase the availability of housing affordable to all income levels in Spokane Valley. The housing needs assessment concluded that 6,660 new housing units are needed to support growth in the City though 2037. With 1,175 of those units needed for households earning 50 percent or less than AMI, this HAP provides recommended actions that focus on supporting this largely rental household population that is largely cost burdened or severely cost burdened. There is also an additional need for 1,039 units that needs to be targeted to households earning between 50 and 80 percent of AMI. Strategies that encourage and provide incentives to develop missing-middle housing typesare provided because these are homes where many millennial families first start or where seniors move to down-size. There is no “silver bullet” for developing housing strategies, as each idea brings benefits, drawbacks, different levels of impact, and tradeoffs. These recommended actions are proposed because they can help to fulfill housing needs equitably across the spectrum of different household incomes. The recommendations are organized under the following goals, and are not ordered in any rank or priority: A. Preserve existing affordable housing and prevent and mitigate displacement. Housing preservation and anti-displacement recommendations can mitigate and minimize the negative effects that often arise from new housing development. Housing preservation and anti-displacement recommendations can expand housing affordability and availability in various ways. Of particular focus is aging housing stock that could be at risk of investment purchases (where they are bought, renovated, and rented at higher prices). This is important in the Census Block Groups identified as at high risk for development feasibility and physical displacement. B. Increase market-rate and affordable housing supply throughout Spokane Valley but focused on zones that support multifamily and missing-middle housing types. The housing needs assessment found that a range of housing types meeting the affordability needs for a range of household incomes will be needed to meet the identified goal through 2037 as illustrated in Figure 11. Recommended actions to encourage the development of a diversified housing stock include SVMC modifications, provision of incentives, and the consideration of a targeted tax exemption. C. Increase housing options and housing choice. Increasing housing choice and expanding options to households in Spokane Valley is a focus of several housing and land use policies and goals. The City has policies and regulations that support “middle housing” development, such as cottages, duplexes, triplexes, and ADUs. Recommended actions will PAGE 29 DRAFT encourage the development of more ADUs, provide for the development of tiny homes and tiny home villages, support transitional housing, and provide for the establishment a City program to fund efforts to supporting housing for the full range of income ranges. 3.1 Summary of Housing Strategy Recommendations Figure 16 provides an overview of each recommended action by category. These recommendations are within Only Recommendations Spokane Valley’s control, but work will span The adoption of this HAP by City Council departments and involve meaningful contributions from does not mean these recommendations will all be advanced. The recommended stakeholders such as the City Council and thePlanning actions will undergo their own process for Commission, as well as renters, homeowners, advocates, review, adoption, and engagement. developers (both affordable and market-rate), and many others. Each housing strategy recommendation presented in Figure 16 includes a description of how it advances Spokane Valley’s Comprehensive Plan housing goals, the rationale for moving forward, and key next steps. Some recommended actions may cross over into other categories. The detailed assessment of each recommended action follows the summary of recommended actions found in Figure 16. PAGE 30 31 PAGE es for the City in in effective s DRAFT engage costs and benefits of a program that includ . the : to receive data. . actions Implementation Considerations Spokane Valley a . nsider working with housing partners in developing esearch and evaluate Evaluate the feasibility from a City resource standpoint of establishing a monitoring program and coa monitoring programRrental housing business license program order to monitor the rental housing stock and the income ranges they serve.Developmethods to evaluate risks and community outreachWork with community organizations to identify new programs and partnerships; identify potential funding sources; consider relocation assistance for displaced renters Work with community organizations and identify potential funding sources - : rent . of actions nsure safe to support these recommended the City seek funding for to increase access to ; et the needs of the community. fair housing policies. buildings of historic value and unique character.” ishing a rental housing Mitigation restricted housing supply. - to support the development of affordable housing units.” to “…support the . partners Description y owners to rehabilitate and preserve buildings of historic value and unique character” to Consider establishing and g for programs requiring financial aid or affordable housing units in pay attention to current conditions in areas ; of affordable housing units.” Implement a program to monitor the supplyrestricted Maintenance of such a knowledge base will allow the City and community housing partners to foresee and plan for threats to rentTo address potential displacement risks, erental housing and collect key data on rental housing properties by establbusiness license programIdentify and track key demographic and socioeconomic data for neighborhoods in Spokane Valleytargeted for growth.Work with community tenant supports. monitoring compliance with Seek fundinresources.Work with community organizations to increase access to homebuyer supportsdown payment assistance and financial counseling classes. s and Policies that support these recommended Land estricted Impacts tance R - ion ed Assis and preservation ent Potential Act R buildings that provide affordable housing and Propos P1 “Support voluntary efforts by propertP3 “Use available financial and regulatory tools Recommended -- isplacement . Summary of Recommended Actions ider a Housing Element Strategy that encourages Spokane Valley to establish a rental housing business license program. Monitor PropertiesRetain Affordable Market Rate UnitsEvaluate Dfrom Use ChangesProvide Tenant SupportProvide Homeowner Resource 6 Preservation of Affordable Housing and Displacement 1 G1 Allow for a broad range of housing opportunities to meG2 Enable the development of affordable housing for all income levels. - - HHRevise H“…preserve Revise Hdevelopment Consider a Housing Element Strategy that encourages Spokane Valley to monitor its regulated affordable housing units.Cons 2 Comprehensive Plan GoalRecommended Comprehensive Plan Goal, Policy, or Strategy Updates A1AA3A4A5 No. Goal A: Action Figure 32 PAGE y ality. needed to DRAFT s solicit input from stakeholders . y and stud Implementation Considerations SVMC a use residential projects” to “…that seek to - lic benefit of affordable units with lost revenues. Review potential actions and draft regulations to revise the Conduct to weigh public benefit of affordable units with lost tax revenues.Conduct additional studies and solicit input to weigh pubWeigh potential areas and resourceimplement a planned action ordinance. - d served - in open to support these recommended actions: 4, multifamily, - use - 4, multifamily, and - velopment where a well emphasis on transit use residential projects.” - Description Consider flexibility income, mixed . - mixed or . use zones - tory tools to support the development of affordable housing units. year MFTE program in R - use zones with an - income, - fordable units. Waive up to 80 percent of impact Plan Goal, Policy, or Strategy Updates Decrease minimum lot sizes, increase density limits, and modify the lot coverage ratios in Rand mixedspace requirements and setbacks for cottages.Adopt 12mixedareas.Allow increased density in exchange for inclusion of affees for projects with affordable units. Consider local sales tax waivers for projects that provide affordable housing at or below 30 percent of AMI.Subareas with a planned action ordinance will provide for streamlined dedefined vision has been defined, infrastructure investments made, and specific incentives createto encourage mixeddevelopment - s and Policies that support these recommended actions:to Supply ion SVMC MFTE ize the density of development along major transit corridors and near transit centers and commercial areas. Act P13 “Work collaboratively with landlords and developers that seek to provide mixed - Recommended affordable housing, mixed dopt a dopt development regulations that expand housing choices by allowing innovative housing types, including tiny homes, accessor Modify the encourage production of townhomes and cottagesAprogramCreate incentives to produce additional market rate and affordable housing Adopt a planned action ordinance(s) in subareas with transit investment or where large, mixeduse phased developments can occur Increase Housing G4 Ensure that land use plans, regulations, review processes, and infrastructure improvements support economic growth and vitP14 Enable a variety of housing types.P16 Maxim --- G1 Allow for a broad range of housing opportunities to meet the needs of the community.G2 Enable the development of affordable housing for all income levels.P2 AP3 Use available financial and regula - --- HHHdwelling units, prefabricated homes, cohousing, cottage housing, and other housing types.HLULULULU Strategy: Collaborate with the private sector to ensure the successful redevelopment of vacant land at Mirabeau Point.Revise LUprovide Recommended Comprehensive B1B2B3B4 Comprehensive Plan Goal No. Goal B: Action 33 PAGE ssory ngage viders. DRAFT Continue to e use land. - partners about the need for to support the development and al housing. ndards and established approved Implementation Considerations . income households. - facilities and how they will integrate in the area. Revise ADU stamodelsReview and modify land use and building codes to permit tiny homes in specific zones.Evaluate best practices and the feasibility of siting shelters or transitionwith the community such , modifications to support these recommended actions: ; income to extremely low - itional housing. been slow ll income levels. . cost trans has - stablish streamlined policies e Description . ng units that target moderate ulations, and guidance relating to the siting of Development of ADUs to the SVMC may increase the production of these attainable unitsAllow tiny homes as an alternative to ADUs. Allow for tiny house villages in MU zones or on publicly/religious owned properties to promote development of lowerConsider minimum density requirements for tiny house villages.Establish siting requirements for homelessness support centers and regHomeless Services in City at are essential to Spokane Valley residents, employees, and visitors. ensive Plan Goal, Policy, or Strategy Updates tiny s and Policies that support these recommended actions: n ion ble financial and regulatory tools to support the development of affordable housing units. Act regulations Recommended Update regulations for Accessory Dwelling UnitsPermit and clarify homeCoordinate with existing systems of care for effective Homeless Services Implementatio Increase Housing Choice G2 Provide for land uses thP9 Provide supportive regulation for new and innovative development types on commercial, industrial, and mixedP14 Enable a variety of housing types. --- G1 Allow for a broad range of housing opportunities to meet the needs of the community.G2 Enable the development of affordable housing for aP2 Adopt development regulations that expand housing choices by allowing innovative housing types, including tiny homes, acceP3 Use availaP4 Enable the creation of housing for resident individuals and families needing assistance from social and human services pro H-H-H-dwelling units, prefabricated homes, cohousing, cottage housing, and other housing types.H-H-LULULUAdd a Housing Element Strategy that focuses Spokane Valley on exploring the development of a housing fund of new units and preservation of existi Recommended Compreh C1C2C3 Comprehensive Plan Goal No. Goal C: Action 34 PAGE the support to s . expend ill DRAFT income households. - currently collect it define how the City w rationale for a housing tax levy Implementation Considerations the range of ways these funds may be used and gauge community support Consider needed staffing resources to and extremely low - e used valuate Efor direct investment or to leverage additional dollars.manage a housing funds program.Draft a plan to sales and use tax funds of lowDevelop the including potential impacts to the average household and a detailed plan for how funds would b a ely ormalize and for affordable d from the recently an affordable housing credit These funds may be used Description income households. - grants, consortium profit service providers and - income to low - Identify new funding sources that may fhousing fund program such as a housing trust fund including, but not limited to property tax levy,supplement funds to be receiveadopted sales and use tax and supportive housing.for direct investments, to leverage grants, and partner with nonaffordable housing developer to support extremlow - , such ion City housing households Act to supporting Recommended extremely low Develop a managed fund programas a housing trust fund,housing for moderate to income C4 No. Action DRAFT 3.2 Assessment of Housing Strategy Recommendations Goal A. Preserve affordable housing and prevent and mitigate displacement. A1. MONITOR RENT-RESTRICTED PROPERTIES Spokane Valley should consider a staff program that allows it to monitor its supply of rent-restricted affordable housing. As described in the Housing Needs Analysis section, Spokane Valley has approximately 1,663 units of rent-restricted affordable housing (see page 12). These properties have been built and maintained at different times, with different funding types and different restrictions on their affordability. They all have various expirations on those affordability restrictions as well. Rationale: When affordability restrictions end, rent-restricted properties are at risk of moving to market-rate housing, losing critical affordability for their tenants. This risk is particularly high if properties are owned by private, for-profit companies (nonprofit affordable housing owners and operators will typically work to keep the rents affordable). When affordability restrictions end, properties often must be recapitalized (get new funding and loans) and/or rehabilitated to improve their physical conditions and renew affordability limits. This funding is typically competitive and hard to find. In tight housing markets, for-profit developers may seek properties that need rehabilitation, finance the construction with debt, and then raise the rents to pay for the debt service, thereby removing units from the affordable housing stock. By monitoring rent-restricted affordable housing properties that are nearing their affordability expiration dates, Spokane Valley can be a strong partner and advocate. With the big-picture knowledge of rent-restricted property conditions the City may either directly work with the property owners through a housing fund program it establishes or direct owners to its housing partners to help secure needed funding and prevent the property from becoming market rate. Next Steps: Evaluate the level of effort and staffing resources needed to establish a monitoring program or identify a community partner to lead the effort. Ensure that Spokane Valley has a relationship with, and proper contact information for, all rent-restricted affordable housing property owner-operators in Spokane Valley. Work with these housing providers to ensure that data sharing is possible; consider setting up a reporting agreement with reporting information and deadlines. Create a database and mapping system to monitor and plan for these upcoming expirations. Become familiar with the various funding sources that are available to support recapitalization and rehabilitation (see Appendix F for a list of national, state, and local funding sources for affordable housing). PAGE 35 DRAFT A2. RETAIN AFFORDABLE MARKET RATE UNITS Spokane Valley should collect key data on its rental housing properties by developing a rental housing business license program. A good starting point would be to establish reporting requirements of landlords and gather additional information on rental rates ranges and housing prices. This would provide Spokane Valley with a more detailed inventory of low-cost market rentals (also called NOAHs) across Spokane Valley. Rationale: Because regulated affordable housing is so difficult and costly to build, most low-income households live in unregulated,but affordable housing. This type of affordable housing is not a rent- restricted property, but a lower-cost property that is attainable to very low-income to moderate- income households. Because these housing units are not regulated, rents can increase by any amount at any time, putting these households at high risk of housing insecurity and displacement. Spokane Valley could evaluate the feasibility of implementing a monitoring program on its own or partnering with a non-profit. This program could provide a unique, low-cost, and low-barrier way to monitor and track the low-cost market rentals. Regular updated access to this type of data would allow Spokane Valley to actively monitor the rents and affordability levels of rental housing as well as to have readily available contact information for landlords when properties are listed for sale. An expanded program could inspect and license rental housing to ensure that landlords maintain their units consistent with livability standards. Tracking Housing Conditions in Spokane Valley A robust housing monitoring database would include the following. Most of these data points (such as address, size, and landlord contact information) likely are already collected through the annual licensing and inspection process, but the database could be more useful if additional information were gathered from landlords. As a start, this type of information could be voluntarily supplied by landlords, with required reporting coming as staffing and organizational capacity allows. In addition, some information (such as code enforcement) may be collected by other city departments or through collaboration with county agencies. The City of Tukwila and the City of Burien have established such programs. Basic InformationAdditional Information Propertyaddress Rents by unit type Property size (number ofunits) Number of renters using rent assistance programs Year built Typical unit amenities Contact information for the landlord Amenities on site Management company (if applicable) Number of units and properties owned by Inspection results and schedules (with landlord (can be provided in ranges) particular attention to deferred maintenance at the property) Property violations or complaints Next Steps: Develop a work plan and identify staffing needs and potential partners. The work plan should consider the feasibility of managing a rental housing licensing program and fee structure to understand impacts for cost-recovery and staffing needs. Inspections and licensing programs can be structured to be revenue neutral, where fees cover all programmatic expenses. PAGE 36 DRAFT Work directly with the Landlord Association to identify and mitigate challenges with the establishment of a monitoring program. Establish criteria to identify properties at risk for displacement, such as those that have low rents, meaningful deferred maintenance, few units (e.g., fewer than 20), noninstitutional owners, and those that are inamenity-rich areas, near recent redevelopments, or on high-cost land. These factors all increase the risk that a mom-and- pop landlord might look at deferred maintenance needs and decide to sell their property to a willing investor. With this information the City or its partners may help match high risk properties with funds from a City housing fund or other resources available to housing partners such as with home repair grants and loan programs supported by the state. PAGE 37 DRAFT A3. EVALUATE POTENTIAL IMPACTS FROM DISPLACEMENT WHEN PROPOSING LAND USE CHANGES Figure 13 shows only one of the manytools and strategies available to monitor displacement risk. Displacement does not happen equally across Spokane Valley, as some neighborhoods and some communities are more likely to be forced from their homes because of economic, physical, or cultural changes. Spokane Valley should continue to monitor these areas as The Displacement Vulnerability Risk development takes place, housing market conditions change, map in Figure 13shows one point in time. Community-level demographic or development opportunities continue to expand. Special changes can occur relatively quickly. attention should be paid to historically marginalized The methodology for this analysis is communities such as communities of color, immigrants, and included in this report and can easily non-English-speaking communities. be updated regularly by City staff. In addition, before land use and Comprehensive Plan updates are enacted in areas with high displacement risk, Spokane Valley should reassess risk and proactively engage with the communities where such changes will be proposed. Spokane Valley should integrate this risk assessment with its approval criteria in SVMC 17.80.140.H for Comprehensive Plan amendments and develop safeguards in response to its findings. Rationale: With a nuanced understanding of the areas that might have the most vulnerability to physical, economic, and cultural displacement, Spokane Valley can employ its anti-displacement recommendations in a geographically focused way. Many of the tenants living in unregulated affordable properties will be at risk if their building is purchased and rents rise. In addition, Spokane Valley-led changes in zoning allowances to allow more intense housing development can increase the chances that households vulnerable to displacement will see increased displacement pressures. Consequently, displacement risk should be assessed before rezones and safeguards are developed in response to the findings. Next Steps: Create an update process for identifying and assessing key factors associated with displacement risk, using the most up-to-date data. Focus on historically marginalized communities such as communities of color, immigrants, and non-English-speaking communities. Spokane Valley could choose to have more targeted outreach in these areas with high displacement risk to better understand the community’s desired outcomes relative to proposed zone changes. PAGE 38 DRAFT A4. PROVIDE MORE TENANT SUPPORT Spokane Valley should explore additional tools and practices to strengthen tenant support. This recommendation suggests working with community organizations to provide a broad array of community-based supports and resources for tenants and renters. The City, either directly or with its housing partners, could better support tenants in accessing services by providing an accessible resource to understand legal protections through the state’s Residential Landlord-Tenant Act (RCW 59.18). Additionally, a responsive code enforcement department for those rentals that are in disrepair or unfit for habitation when landlords are nonresponsive may also help. Rationale: Direct resources that support residents in Spokane Valley will help minimize and mitigate the effects of displacement pressures. At the federal level, the Federal Fair Housing Act prohibits housing discrimination based on race, color, national origin, religion, sex, familial status and disability. (Title VIII of the Civil Rights Act of 1968, as amended in Organizations such as the Fair Housing 1988 (42 U.S.C. §3601 et seq.) and Civil Rights Act of 1866 Center of Washingtonserve as a resource (Title 42 of the United States Code sections 1981 and for jurisdictions implementing projects 1982)). Tenants need to know their federal and state tenant that use federal funds to affirmatively further fair housing (AFFH). Local Housing rights and feel empowered to maintain their housing, Solutions is another resource that particularly for households belonging to marginalized connects housing strategies with AFFH. communities (such as immigrant and refugee communities, communities of color, and low-income communities). Next Steps: Spokane Valleycould establish, update, or strengthen resources available to tenants involving: Low-barrier application screening (e.g., Fair Choice Housing or Ban the Box efforts). Create tenants’ rights and education resources (e.g., funding for RentWellprograms). Require language translation of tenant information to increase the education available to immigrant and refugee communities. PAGE 39 DRAFT A5. PROVIDE HOMEOWNER RESOURCE ASSISTANCE Spokane Valley should work with community organizations to explore and expand on a range of homeownership assistance programs. There are many aspects of homeownership assistance that Spokane Valleycould consider supporting through partnerships with regional organizations. Rationale: A major way to mitigate displacement is by increasing the homeownership rate, particularly for low-income households, households of color (who have historically lower homeownership rates than white households), as well as immigrants and refugees.Displacement often does not affect homeowners, in large part because they have fixed mortgage payments that cannot change without warning (taxes do change but they are a small portion of overall homeownership housing costs). In addition, because lenders size a mortgage to a buyer’s income and ability to pay, homeowners are less susceptible to cost burdening and housing insecurity, absent a sudden change in income. Because homeowners are largely shielded from larger economic and housing market changes, encouraging homeownership is one of the best ways to prevent physical and economic displacement. It cannot, however, prevent cultural displacement. Next Steps: Homeownership down payment assistance programs can be challenging to maintain and can only help a limited number of households. Many homeowner and homebuyer resources require fundingthrough grant programs such as the Washington State Housing Trust Fund grants and loans or HUD’s HOME programs managed by Commerce. Spokane Valley’s role can be to enhance its partnerships with regional organizations already working in these areas and explore avenues to educate and provide resources for prospective homeowners. Areas where the City can provide additional resource support include: Hosting homebuyer education (classes educating renters on the home buying process). Foreclosure assistance and counseling. Energy assistance and counseling. Provide resources on cooperative ownership housing models (information and guidance for tenants looking to buy out a landlord and establish a cooperative ownership structure). Provide resources on community land trust models (which provide shared equity as home prices appreciate, while still maintaining long-term affordability). Down payment assistance (funding would have to be identified, and income thresholds would have to be carefully considered to establish eligibility criteria). Homeownership weatherization and rehabilitation grants. PAGE 40 DRAFT Goal B. Increase market-rate and affordable housing supply throughout the city but focused on zones that support multifamily and missing-middle housing types. B1. MODIFY THE SVMC TO ENCOURAGE PRODUCTION OF TOWNHOMES AND COTTAGES Townhouses and cottages are permitted under the supplemental use regulations in the R-4, MFR, MU, and CMU zoning districts. The Neighborhood Commercial zoning district also permits townhouses. Spokane Valley defines a townhouse development as one where between three and six attached single- family dwelling units are developed side by side, and a cottage development as one where small, detached, single-family dwelling units are developed as a group clustered around a common area. A limited number of townhomes have been developed in the City, and no cottage projects have been completed to date. This action recommends modifications to density requirements and minimum lot sizes in the R-4 zone, and allowing unit-lot subdivisions to improve development feasibility for townhome and cottage developments. Unit-lot subdivision defines boundary lines and use areas within a larger "parent" parcel for the purpose of defining and creating individual sellable lots. This is primarily used when multiple buildings are designed to fit on a single original lot such as for townhome and cottage developments. Site development standards apply only the parent site as a whole. New buildings are on individual lots allowing for fee simple transfer to new owners. Many cities have adopted code to support this type of subdivision including Spokane, Wenatchee, Arlington, Seattle, and Bellevue to name a few. The following recommended SVMC modifications would improve development feasibility and encourage the development of more missing-middle housing for moderate-income and middle- income households. Increase the residential density in the R-4 zone from ten du/ac to 15 du/ac. Decrease the minimum lot size for townhomes in the R-4 zone from 4,300 square feet to 2,000 square feet. Reduce the building setback and open space requirements for cottage developments for projects that provide affordable housing. Allow unit-lot subdivisions. Rationale: The City already accommodates townhouses and cottages as permitted uses in the R-4 zone, so modifications that help encourage these product types are likely to be more palatable politically than extending these changes to other residential zones. The regulatory review in Appendix C highlights regulatory barriers that limit townhome development. The development feasibility analysis in Appendix E found that the current code results in residual land values that fall at or below average land prices. Further, for lots with existing homes, the development economics become even more challenging. The analysis of the modifications found that developers likely will respond positively by producing townhome units in R-4. Because of challenging economics, cottage projects are not as common as townhomes. Reducing setbacks and open space requirements for cottage projects with affordable housing improves development economics and will encourage more missing- middle development. PAGE 41 DRAFT Next Steps: Review potential actions and draft regulations to revise the SVMC. Evaluate the potential impacts from displacement of residents in existing NOAH single- family rental homes and consider the potential benefits and resource costs/impacts to implement a relocation fee program. The fee would be paid by developers to the City’s housing fund for supporting tenant relocation elsewhere in Spokane Valley. PAGE 42 DRAFT B2. ADOPT A MFTE PROGRAM Spokane Valley should consider establishing a 12-year MFTE program in mixed-use and multifamily zones that are transit served. Spokane Valley should consider establishing a MFTE program with the 12-year affordability requirements to capture value from the financial incentive. This MFTE program should also be packaged with modifications to density standards. With the COVID-19 pandemic hurting cities’ economic and fiscal outlooks, special consideration will have to be given to the impact of an MFTE program on Spokane Valley’s tax revenues. Rationale: Tax abatements positively impact the feasibility of projects where market-rate projects are feasible and can help cross-subsidize the affordable units. When considering a MFTE program, careful consideration of the temporary loss of tax revenue from the new When a project is approved under affordable units against the potential attraction of new a multifamily tax exemption investment. MFTE can help support increased housing program, the value of eligible production by increasing the feasibility of multifamily and housing improvements is exempted mixed-use development. If MFTE were to be applied in areas . Property tax from property taxes revenue is still collected on planned for frequent transit, such as the Sprague, it could remainder of the project. increase the development feasibility of the existingMFR and mixed-use zones. The current development standards in the MFR zone create marginally feasible projects, but the MFTE program with the 12-year tax exemption will add new units at 80 percent of AMI or less that would not have been developed otherwise. The 12-year MFTE program specifically increases the supply of affordable housing, and this incentive could be paired with an increased allowed density from 22 du/ac currently allowed in the MFR zone up to 40 du/ac. Such an incentive would improve the development feasibility of projects adding density. Multifamily development in the CMU and MU zones is considered commercial and has no density limits.Project in these mixed-use zones will not need the density bonus; however, the MFTE program will improve project performance and provide units affordable to moderate income households. Next Steps: Explore the programmatic implications for the City to create and manage a 12-year MFTE program for projects delivering at least 10-units to support both housing development and new affordable housing. The City could refer to other city’s MFTE programs such as the City of Bellingham’s (https://cob.org/services/planning/development/mfte). To weigh the fiscal impacts and potential benefits associated with increased housing production (market and affordable units) study the potential impacts to the City’s tax base. Specific to Spokane Valley is that it has not taken its property tax increases for 12 years, so the only increase in property tax is from new construction. An MFTE program that reduces tax revenue from the affordable units in new developments would have an increased effect for the City’s revenues compared to cities who take annual increases. Conduct additional outreach with developers, impacted residents, and other stakeholders to determine the best approach to land use changes. Ensure that potential displacement is evaluated alongside any proposed land use density changes. PAGE 43 DRAFT Map out the process to adopt a MFTE program including the creation of targeted areas (RCW 84.14.040) that are designated urban centers. The creation of urban centers requires a Comprehensive Plan amendment. Urban center means a center designated as such in the land use element of the City’s Comprehensive Plan. An urban center is an identifiable district containing business establishments, adequate public facilities, and a mixture of uses and activities, where residents may obtain a variety of products and services (RCW 84.14.010(18)). PAGE 44 DRAFT B3. CREATE INCENTIVES TO PRODUCE ADDITIONAL MARKET RATE AND AFFORDABLE HOUSING Several tools for incentivizing market rate and affordable housing may be adopted by Spokane Valley. These incentives provide an exchange where a city offers a benefit to a proposed project such as a density bonus, a mechanism for reducing project costs like reduced parking, or a means to streamline the permitting process. In exchange,the developer agreesto provide a certain percentage of affordable units for a certain number of years. These incentives could be limited to certain zones or overlay zones. Density bonus programs may also allow developers to contribute to a housing fund in lieu of building the units themselves. The following incentives are recommended strategies to increase affordable housing production (see Appendix E the analysis summary): This HAP recommends modifying the permitted R-4 density from 10 du/acto 15 du/ac to encourage townhome and cottage development. This strategy recommends increasing the modified permitted density from 15 du/ac to 22 du/ac for townhome and cottage developments if 20 percent of the units are set aside for households earning 80 percent or less of AMI. These units would also be eligible for the MFTE incentive. Increase the allowed density in the MFR zone from 22 du/ac to 40 du/ac if 20 percent of the units are set aside for households earning 80 percent or less of the AMI. These units would also be eligible for the MFTE incentive. Consider a fee-in-lieu program for projects seeking the additional density but choosing to forego providing affordable housing on site. These funds would be managed by Spokane Valley’s housing fund program to support affordable housing elsewhere in the City. Waive up to 80 percent of impact fees for projects that provide affordable units targeted toward households earning 60 percent or less of the AMI. Rationale: The analysis in Appendix Efound that the development economics create a strong motivation for the development community to respond positively to these incentives. Pairing the density bonus with affordable housing requirements provides housing choices for a broader range of household incomes. Next Steps: Conduct additional studies and solicit input to weigh public benefit of affordable units with lost property tax and sales tax revenues. Evaluate a fee-in-lieu program to access the density bonus in exchange for funds that Spokane Valley may use to support affordable housing development and preservation. PAGE 45 DRAFT B4. ADOPT A PLANNED ACTION ORDINANCE(S) IN SUBAREAS WITH TRANSIT INVESTMENT OR WHERE LARGE, MIXED-USE PHASED DEVELOPMENTS CAN BE BUILT Planned actions, which are authorized under SEPA (RCW 43.21C.440 and WAC 197-11-164 through -172), provide more detailed environmental analysis during an areawide planning phase rather than during the permit review process. As a result, future projects in the designated planned action area do not require SEPA determinations at the time of permit application if they are consistent with the type of development, growth and traffic assumptions, and mitigation measures studied in the environmental impact statement or the threshold determination. Rationale: A planned action ordinance would help streamline the development process for projects in the planned area.Planned actions may help Spokane Valley increase its housing supply and add to its low- and middle-income housing stock near transit and jobs. Transit oriented development around Spokane Transit Authority (STA) investments also encourages more ridership helping to justify its investment. Next Steps: Administering the planned action ordinance process can be an expensive endeavor for the City. It should estimate the resources to develop needed to implement a planned action ordinanceand identify potential grants or funding partners such as the STA that may help offset these costs. Identify potential subareas for a planned action. Two areas for consideration may be a portion of the Sprague Avenue corridor between Havana and Pines and the station area at Mirabeau Point. Coordinate with the STA on its plans for future station areas and discuss the concept of partnering with housing developers to provide affordable housing its surface parking lots in a transit-oriented development. PAGE 46 DRAFT GOAL C. INCREASE HOUSING OPTIONS AND HOUSING CHOICE. C1. UPDATE REGULATIONS FOR ADUS ADUs are currently permitted in all Spokane Valley zoning districts except for MFR. These units are regulated by SVMC 19.40.030, which contains the siting, building, parking, and ownership requirements for developing an ADU. Several recommended revisions to this section could increase the pace of ADU development. Appendix G provides additional background on ADUs.Spokane Valley could consider the following: Eliminate or reduce the off-street parking requirement for an ADU if the owner can provide evidence it already has enough parking area to meet this requirement. Adding off- street parking space to the existing parking requirements can make development of an ADU cost prohibitive and physically impossible. Remove the ownership requirement for developing an ADU. There are over 4,850 single- family homes in Spokane Valley for which the taxbills are mailed to different addresses. These homes are likely rental properties and would not be allowed to have an ADU. Generally, requiring owner-occupancy of one of the units can negatively impact ADU construction. Some cities have removed such requirements or has modified them—for instance,the City of Renton exempts owner occupancy requirements in exchange for 60- percent-AMI affordability. Spokane Valley should explore whether there are feasible opportunities to relax the size limitations to allow for more flexibility and smaller units that could result from the conversion of garage spaces. Relaxing the ADU setback requirements (particularly the side and rear) to five feetcould make ADU projects more feasible, particularly on lots with irregular or elongated shapes. Lower barriers to allow homeowners to consider developing ADUs and consider reducing costs by allowing strategic permitting fee waivers for affordable dwellings. Increasing the density to allow for two ADUs per lot could be helpful, particularly if Spokane Valley sees increasing demand for ADU housing options. Jurisdictions will not see large numbers of ADUs being constructed until the market rents reach a level that makes development feasible. Monitor: Cities may need to address short-term vacation rental use of ADUs and spillover effects in terms of parking, service, and neighborhood impacts. Rationale: The City recognizes that approximately 30 ADUs have been formally developed in Spokane Valley since 2012 based on available permit data. These recommendations are intended to encourage the development of ADUs. These units help to broaden housing diversity and choices in a wider range of neighborhoods,since they can be offered at a more affordable cost because of their small size. ADUs also offer additional options for seniors and younger populations, single-person households, etc. The AARP surveyed people 50 and older and found thatthey would consider creating an ADU to provide a home for a loved one in need of care (84 percent), provide housing for relatives or friends (83 percent), feel safer by having someone living nearby (64 percent), have a space for guests (69 percent), increase the value of their home (67 percent), create a place for a caregiver to stay (60 PAGE 47 DRAFT 8 percent), and earn extra income from renting to a tenant (53 percent). Finally, ADUs can blend into single-family neighborhoods and be a source of added income to help pay housing expenses. Next Steps: Evaluate the possible impacts from modifying the ADU regulations around parking and ownership requirements. Revise ADU development standards in the SVMC. Eliminate or reduce ADU-related permit fees. Established approved ADU models to expedite permitting. 8 Source: AARP Home and Community Preferences Survey, 2018. PAGE 48 DRAFT C2. PERMIT AND CLARIFY TINY HOME REGULATIONS Tiny houses are one way to provide a housing option for individuals and households who desire privacy and smaller home size but prefer single-family home amenities. Tiny homes, sometimes referred to as micro-homes, are small, single-family Micro-home (i.e. Tiny homes) dwellings, typically 80 to 200 square feet but almost always vs Micro housing units less than 500 square feet and have a kitchen and a bathroom. Micro housing units typically are very Appendix G provides additional background on tiny home small dwelling units in multi-family considerations. buildings in which all living space other than a bathroom is contained in a single room (usually under 300 square feet). Until recently, state law, building codes, and local Generally, the units share common regulations have presented numerous legal and logistical kitchen, laundry, and gathering spaces. barriers to siting and building these very small, detached Micro-housing in theory could be less dwellings. In 2019, the state legislature passed ESSB 5383, expensive than a standard 1-bedroom apartment but this is not always the which updated state law to enable the development of tiny case. This type of housing usually is houses or tiny house communities throughout the state. targeted to a very specific population— This law defined tiny houses and mandated that the building person households typically in single- code council write building codes for tiny homes by the end their 20s and 30s either in college or of 2019. Washington State has adopted Appendix Q Tiny working. Houses which relates to tiny homes on a foundation. Spokane Valley can do the following to study and improve its code and policies on tiny houses: Add definitions for tiny houses to differentiate them from trailers, manufactured homes, and recreational vehicles. This includes clarifying that only tiny houses on foundations (not on wheels) are allowed. Create a permit pathway for Binding Site Plans that allow siting of tiny homes (such as in a manufactured-home park). Consider modifying the land use matrices to specify where tiny houses or tiny house villages would be permitted or conditionally allowed. In general, review the zoning code to identify potential hurdles associated with tiny home development. Tiny house village communities include property that can be rented or held by other others for the placement of tiny houses. These can also provide transitional housing for those experiencing homelessness (these villages have been built in Olympia and Seattle). Allow tiny homes, set on a foundation, to be utilized as a detached ADU to lower construction costs. Analyze the potential for the updated International Residential Code (IRC) with Appendix Q (2018) modified to be included in the building code to incorporate tiny house building standards. This IRC defines a tiny house as a dwelling smaller than 400 square feet excluding lofts. The Washington state legislature (via ESB 5383) recognizes that the IRC has issued tiny house building code standards in Appendix Q which can provide a basis for the standards requested within this act. This is important since the building code can be the most significant hurdle for legally constructing a tiny home. PAGE 49 DRAFT Rationale: Tiny houses are one way to provide a housing option for individuals and households who desire privacy but do not want or cannot afford a large,single-family home. They can also be used as a way of providing housing for people experiencing homelessness. Next Steps: Review and modify land use and building codes to permit tiny homes in specific zones. Update site plan approval criteria to account for unique site needs of tiny houses. This would benefit from a process soliciting input from tiny home developers. As a first step, the City should solicit input or convene a focus group or working group including tiny house owners and developers, city planners, and city building code experts to review how tiny homes would fit in the existing site plan approval process and identify regulatory barriers and possible areas of flexibility related to the use of the IRC. Because a negative perception of tiny homes may present hurdles, develop material summarizing the rationale and benefits for this housing type. PAGE 50 DRAFT C3. COORDINATE WITH EXISTING SYSTEMS OF CARE FOR EFFECTIVE HOMELESS SERVICES IMPLEMENTATION Homelessness is a housing challenge in Spokane Valley. The Washington state Growth Management Act requires that communities plan for all economic segments of the population. This strategy addresses the very lowest income segments by recommending approaches to supporting shelters and transitional housing to help stabilize these households as they move into permanent housing. There are several ways that cities can address homelessness. The Homelessness & Housing Toolkit for Cities produced by Association of Washington Cities and Municipal Research and Services Center (2020) provides some resources and case studies. Rationale: Spokane Valley has identified a need to include goals and strategies related to homelessness in the current Comprehensive Plan update process. While the Comprehensive Plan includes goals and strategies related to affordable housing, it does not currently address homelessness. This strategy provides recommendations for supporting the very lowest income segments of Spokane Valley. Next Steps: Include a land use and housing goal in the Comprehensive Plan that addresses Spokane Valley’s intention to supporting transitional housing. Identify best practices and potential siting requirements for shelters and transitional housing such as tiny home villages, including, but not limited to, land owned by the public or a religious institution. Actively engage with existing service providers, faith-based organizations and regional bodies to coordinate housing resources. Consider Spokane Valley’s role in the countywide approach to addressing homelessness and evaluate the benefits and impacts from managing its portion of the real estate excise tax fees to support the homeless community as it seeks to transition to stability. PAGE 51 DRAFT C4. DEVELOP A HOUSING FUND PROGRAM A Spokane Valley housing fund program could serve three functions: (1) being a resource for the development community seeking input on funding options; (2) managing active funding resources such as Spokane Valley’s recently adopted sales and use tax funds for affordable and supportive housing or other potential future funding sources; and (3) collaborating, educating and advocating on new projects, initiatives, and the pursuit of new funding sources. Rationale: A housing fund program will help facilitate more housing options at the moderate-to low- income levels. There is one active funding sources this program can manage plus several others it could help Spokane Valley evaluate and pursue. This program could also help manage monitoring activities identified in Strategies A1 through A3. In the near term, this program would manage the sales and use tax fund for affordable and supportive housing. Spokane Valley has estimated the annual increase of funds from this program to be approximately $178,000. These funds can be used for acquiring, rehabilitating, constructing, or operating and maintaining new affordable housing units. These funds cannot be used to fund construction or operation of a homeless shelter, but instead are reserved for longer-term low income, affordable, and supportive housing. Spokane Valley can use these funds independently, or they can be pooled in partnership with funds from other regional organizations to pay for a larger regional affordable housing development. Spokane Valley may consider two other funding sources that may support a housing fund program promote housing choice and increase housing options: Homeless Housing Assistance Act (HHAA) funds and a city-wide property tax levy (RCW 84.52.105). To begin receiving HHAA funding from recording fees, Spokane Valley would need to take responsibility for homeless housing within its borders by forwarding a resolution to the Spokane County Board of Commissioners stating its intention and commitment to operate a separate program. Spokane Valley must then comply with the same requirements as Spokane County and the City of Spokane under the HHAA. Based on 2019 recording fee collections, this program could generate approximately $657,750 per year. The property tax levy requires voter approval and would place an additional tax ofup to $0.50 per thousand dollars assessed for up to ten years. For a home valued at $300,000,this levy would increase the household property tax burden by $150. Funds must go toward financing affordable housing for households earning below 50 percent MFI. Based on current tax rolls, this could generate up to approximately $4.7 million per year. While these taxpayer supported funds could be leveraged to a range of affordable housing developments and initiatives, passing a levy can be very challenging. Even with a well-defined rationale communicated to the public, taxpayers may still not support an additional tax. A complete list of Washington state, local, and federal affordable housing funding sources can be found in Appendix F. A Spokane Valley program can coordinate with other regional housing providers and offer developers resources when seeking tax credit or bonding funding from the Washington State Housing Finance Commission as well as resources from Commerce-led funding programs. These funding sources are competitive statewide. PAGE 52 DRAFT Next Steps: Identify and define the housing fund programincluding sources of revenue, programmatic priorities, and staffing resources needed in order to justify its creation. Evaluate the resources needed to staff the program. Ensure that its focus is on supporting the development and preservation of low- to moderate-income households in areas of Spokane Valley that are served by transit or where households are at greater risk for displacement. PAGE 53 UBC$6 DRAFT 4 IMPLEMENTATION PLAN In the coming years, implementing the HAP will require Spokane Valley to balance and coordinate its pursuit of actions, funding, and partnerships with its other policy and programmatic priorities. This section outlines an implementation process that will improve success with advancing this HAP’s recommendations. 4.1 Develop and Assign Work Programs The city’s implementation of the 13 recommendations in this HAP will require varying levels of effort. Each recommendation will require different levels of partnership and staff time andwill function at varying scales (working at the property, neighborhood, or citywide level). Each of these recommendations is within Spokane Valley’s control, but work will span departments and involve meaningful contributions from stakeholders such as the City Council, Planning Commission, residents, homeowners, neighborhood associations, advocates, developers (both affordable and market rate), and many others. The city will need to assess the varying levels of effort, assign staff, and examine technological solutions to develop work programs that can help complete the needed analysis and initiate important conversations with these stakeholders. It is important to have a HAP that balances different housing needs among its current and future residents. This HAP includes targeted actions to help compensate for where the supply is tight and to help those who are underserved or where demand is growing. The recommendations also address the need for both subsidized and non-subsidized market rate housing. Figure 17 provides an overview of each action, focusing on their impacts to Spokane Valley’s key goals of increasing housing affordability and lowering displacement risk. PAGE 54 55 9 termterm term, term, term, term, term, -- ----- PAGE Timing ongoingongoingongoingongoingongoing ShortShort Proposed ShortShortShortShortShort DRAFT )) AMIAMI taff timetaff timetaff timetaff timetaff time Existing sExisting sExisting sExisting staff timeExisting staff timeExisting sExisting s income (above 120%income (above 120% Potential Operational -- ighigh Funding and Staff Resources HH )) years, completed by 2026 | Ongoing 5 - AMIAMI 120%120% or or or term: 4 -- - . income (80income (80 -- Division or Division or CoordinatorCoordinator iddle CoordinatorCoordinator iddle Coordinator Lead/ Partners Implementation MM Community partnerCommunity partnerCommunity partnerCommunity partnerCommunity partner Housing & Homeless Housing & Homeless Housing & Homeless Housing & Homeless Housing & Homeless Economic Development Economic Development ) HighHigh AMI 80%80% AMI)e -- ementation Considerations 3 years, completed by 2024 | Long - income (60income (60 -- Needed term: 2 - AdministrativeAdministrativeAdministrativeAdministrativeAdministrativeAdministrativeAdministrativ Type of Action oderate MModerate ModerateModerate 0% AMI) LowLow then… housing monitoring income (below 60% AMI)income (below 6 - -- LowLow task, task, then… identify the potential for a unding sources that are affing resources needed to restricted affordable housing term: 1 year, start after plan approval | Medium - - the first the first and Short Restricted Properties - nt Task Description the creation of a rental and mapping system to monitor that flags at ta sharing relationship with housing providers. . Summary of Recommended Actions and Impl 7 challenges with the establishment of a monitoring Proposed timing description: Household Incomes Targeted: Ability to Reduce Displacement:Household Incomes Targeted: Ability to Reduce Displacement: 9 If City chooses to advance past If City chooses to advance past Action A1: Monitor ReAction A2: Retain Affordable Market Rate Units Document the level of effort and stestablish a monitoring program community partner to lead the effort. Creation of contact list for all rentproperties and property owner/managers in Spokane Valley.Establish a daProvide them with a reporting agreement with reporting information and deadlines.Create a databaserisk regulated properties of and plan for these upcoming expirations.Develop a shareable database of favailable to support recapitalization and rehabilitation.Develop a work plan for and identify staffing needs and potential partners for program. Work directly with the Landlord Association to identify and mitigate program. Goal A: Preservation of Affordable Housing and Displacement Mitigation Figure 1 56 9 term term, term, term, term, term, term, term, - ------- PAGE Timing ongoingongoingongoingongoingongoingongoingongoing Short Proposed ShortShortShortShortShortShortShort DRAFT )) AMIAMI taff timetaff timetaff timetaff timetaff time Existing sExisting sExisting sExisting sExisting s City housing fund income (above 120%income (above 120% Potential Operational -- 1.0 FTE to manage program.1.0 FTE to manage program.1.0 FTE to manage program. --- ighigh 000 Program fees and/or City fundsProgram fees and/or City funds Funding and Staff Resources HH Program fees, City funds and/or ) AMI 120%120% AMI) or or -- DevelopmentDevelopment income (80income (80 DivisionDivision -- Division or CoordinatorCoordinatorCoordinator CoordinatorCoordinator iddle Lead/ Partners ommunity partner Implementation MMiddle Community partnerCCommunity partner Housing & Homeless Housing & Homeless Housing & Homeless Housing & Homeless Housing & Homeless Economic Development Economic Economic HighHigh 80% AMI)80% AMI) -- income (60income (60 -- Needed Legislative AdministrativeAdministrativeAdministrativeAdministrativeAdministrativeAdministrativeAdministrativeAdministrative Type of Action ModerateModerate ModerateModerate ) MI) . rom Proposed Land Use Changes in tenants to from a City immigrant risk for properties to LowLow income (below 60% AMIincome (below 60% A risk -- - funds LowLow high based form for eligible for resources. The - ng how potential policy nt of database, system for , update and maintain a GIS in these areas with high urces available to housing partners accurately translated in multiple Task Description date data - to - . due to property disinvestment and/or increasing kit for eligible landlords of - Provide More Tenant Support to increase the education available to : that identifies the areas with the greatest 4 . review standard for assessi targeted outreach Household Incomes Targeted: Ability to Reduce Displacement:Household Incomes Targeted: Ability to Reduce Displacement: sing the most up stablish criteria to identify properties Action A3: Evaluate Potential Displacement Impacts fAction A Implement work plan, informed by input from Landlord Association, including establishmecollecting information from landlords and tenants, and a potential fee system.Elist of properties identified would be flagged as at displacementland values.Create a toolneed of upgrades to assist with resourcing housing fund or other resoUweb mapdisplacement risk. Create an update process for maintaining the web mapConduct displacement risk to better understand the community’s desired outcomes relative to proposed zone changes.Create achanges may impact housing in neighborhoods facing displacement riskCreate a resources webpage that is updated regularly for tenant information that islanguagesand refugee communities.Related to Action A1, provide a websubmit comments on the condition of their housing unit for monitoring trends. 57 910 9 term term, term, - -- term termterm - -- PAGE Timing ongoingongoing Timing ShortLongShort Proposed Proposed Medium MediumMedium DRAFT )) AMIAMI taff timetaff timetaff time grant fundinggrant funding Existing sExisting sExisting s City housing fund income (above 120%income (above 120% Potential Operational Potential Operational -- 1.0 FTE to manage program. - ighigh Existing staff time, Potential for Existing staff time, Potential for 0 Funding and Staff Resources H Funding and Staff Resources H Program fees, City funds and/or 5 years, completed by 2026 | Ongoing - ess 120% AMI)120% AMI) term: 4 or or or or -- - income (80income (80 -- Coordinator CoordinatorCoordinatorCoordinatorCoordinator Lead/ PartnersLead/ Partners Planning Division Implementation Implementation MiddleMiddle Division, Building & Community partnerCommunity partnerCommunity partnerCommunity partner Housing & Homeless Housing & Homeless Housing & Homeless Housing & HomelHousing & Homeless Economic Development s HighHigh 80% AMI)80% AMI) -- 3 years, completed by 2024 | Long - . income (60income (60 -- term: 2 NeededNeeded - ate AdministrativeAdministrativeAdministrativeAdministrativeAdministrativeAdministrative Type of Action Type of Action ModerModerate ModerateModerate . to - . in a models from a City properties to focused in LowLow Assistance income (below 60% AMI)income (below 60% AMI) re assistance and risk middle housing types -- - - funds ’s existing or new LowLow that may result from and draft regulations high already oreclosu Resource rate and affordable housing supply throughout the city but focused on zones that support community land trust term: 1 year, start after plan approval | Medium - homes - or to encourage production of townhomes and cottage Short organizations through the City SVMC potential actionsincome unit production. Task DescriptionTask Description - family rental the - tifamily and missing kit for eligible landlords of - Modify and counseling in partnership with regional : Provide Homeowner 5 1: mul B : Increase market recommended B Proposed timing description: Household Incomes Targeted: Ability to Reduce Displacement:Household Incomes Targeted: Ability to Reduce Displacement: 9 10 artnerships with regional xplore avenues to educate and provide resources for Action AAction Eprospective homeowners pproviding homeownership assistanceHost home ownership seminars and fcounseling organizations. Host or collaborate with a partner organization to createhomeownership resource webpage for prospective buyers, for distressed homeowners, or for developers seeking information on cooperative ownership housing Create a toolneed of upgrades to assist with resourcing housing fund or other resources available to housing partnersReview revise the SVMC.Evaluate the potential impacts from displacement of residents in existing NOAH singleregulation modifications and weigh against potential new lowincome and moderate Goal 58 10 9 termtermtermtermterm termtermterm term, -------- - term - term to term to term to --- PAGE ongoing Timing Short Proposed ShortShortShort MediumMediumMediumMediumMedium mediummediummedium Medium DRAFT ) AMI to evaluate. taff time grant fundinggrant fundinggrant fundinggrant fundinggrant funding Existing staff timeExisting staff timeExisting staff timeExisting staff time income (above 120% AMI)income (above 120% Potential Operational 1.0 FTE to manage program -- - 1.0 FTE to manage program. xisting staff time, Potential for - igh Existing s EExisting staff time, Potential for Existing staff time, Potential for Existing staff time, Potential for Existing staff time, Potential for 0 Program fees and/or City funds0.5 Funding and Staff Resources HighH % AMI) 120% AMI)120 -- inator Housing & Housing & Housing & Building & DevelopmentDevelopment & && income (80income (80 DivisionDivision -- Coord Lead/ Partners Planning DivisionPlanning DivisionPlanning DivisionPlanning Division Implementation MiddleMiddle Division, Building & Division, Building & Division, Division, Building & Housing & Homeless DivisionDivisionDivision Homeless CoordinatorHomeless Coordinator Homeless Coordinator Economic Development Economic Development Economic Development Economic Development Economic Development Economic Economic Economic Development Economic Development HighHigh / 80% AMI)80% AMI) -- income (60income (60 -- Needed LegislativeLegislativeLegislative AdministrativeAdministrativeAdministrativeAdministrativeAdministrativeAdministrativeAdministrative Administrative Type of Action ModerateModerate ModerateModerate . to to . LowLow income (below 60% AMI)income (below 60% AMI) program -- LowLow MFTE program ee would be paid by F year - to support affordable housing Program Task Description potential new affordable and market MFTE and programmatic implications and programmatic implications l outreach with developers, impacted lieu program to access the density bonus in - cess tential benefits and resource costs/impacts to , and manage a 12, and manage the incentive in impacts and household displacement. - housing program reate incentives to produce additional market rate and affordable housing dopt a AC nd other stakeholders to determine the best scal impacts and potential benefits associated with resulting from the recommended incentives against adoptadopt 2: 3: BB public benefit of units Household Incomes Targeted: Ability to Reduce Displacement:Household Incomes Targeted: Ability to Reduce Displacement: hange for onsider the po tudy the fi Action Action Cimplement a relocation fee program. developers to the City’s housing fund for supporting tenant relocation elsewhere in Spokane Valley.Seek code adoption and related Comprehensive Plan AmendmentsMap out the process develop, Sincreased housing production (market and affordable units).Conduct additional outreach with developers, impacted residents, aapproach to land use changes.Seek code adoption and related Comprehensive Plan AmendmentsStudy rate potential fiscalEvaluate a feeexcdevelopment and preservation.Map out the prodevelop, Conduct additionaresidents, and other stakeholders to determine the best approach to land use changes. 59 9 10 11 9 termtermtermterm ---- term to term term term - - - - PAGE Timing long Timing LongShort Proposed Proposed MediumMediumMediumMedium Medium DRAFT )) AMIAMI funded City grant fundinggrant fundinggrant fundinggrant fundinggrant fundinggrant funding ng staff time, Potential for 0.5 FTE to support process, - income (above 120%income (above 120% Potential Operational Potential Operational -- ighigh Existing staff time, Potential for Existing staff time, Potential for Existing staff time, Potential for ExistiExisting staff time, Potential for Existing staff time, Potential for 0.25 Funding and Staff Resources H Funding and Staff Resources H use phased developments can be built - ) 5 years, completed by 2026 | Ongoing - AMI 120%120% AMI) term: 4 -- - uilding & ing Division income (80income (80 DivisionDivisionDivision -- iddle Lead/ PartnersLead/ Partners Planning DivisionPlanning DivisionPlanning DivisionPlann Implementation Implementation MMiddle Division, Building & Division, BDivision, Building & Division, Building & Economic Development Economic Development Economic Development Economic Development Economic Development Economic Development Economic Development HighHigh 80% AMI)80% AMI) -- 3 years, completed by 2024 | Long - income (60income (60 -- NeededNeeded term: 2 LegislativeLegislative - AdministrativeAdministrativeAdministrativeAdministrativeAdministrative Type of Action Type of Action ModerateModerate ModerateModerate reas with transit investment or where large, mixed - LowLow come (below 60% AMI) income (below 60% AMI)in -- s rdinance(s) in suba LowLow O ADU term: 1 year, start after plan approval | Medium - Short Task DescriptionTask Description pdate regulations for dopt a Planned Action round parking and ownership requirements. U A ncrease housing options and housing choice. : I e with the STA on its plans for future station areas and 1: ty to Reduce Displacement: : B4 C Proposed timing description: Household Incomes Targeted: AbiliHousehold Incomes Targeted: Ability to Reduce Displacement: 9 11 stimate the resources to develop needed to implement a Action Action C Seek code adoption and related Comprehensive Plan AmendmentsEplanned action ordinance and identify potential grants or funding partners such as the STA that may help offset these costs.Identify potential subareas for a planned action.Coordinatdiscuss the concept of partnering with housing developers to provide affordable housing its surface parking lots in a transitoriented development.Conduct SEPA and seek code adoption and related Comprehensive Plan AmendmentsEvaluate the possible impacts from modifying the ADU regulations aRevise ADU development standards in the SVMC. Goal 60 9 11 termtermtermtermtermterm ------ termtermterm term, --- - PAGE Timing ongoing ShortShortShort Proposed Short MediumMediumMediumMediumMediumMedium DRAFT ) ntial for AMI grant fundinggrant fundinggrant fundinggrant fundinggrant fundinggrant fundinggrant funding Existing staff timeExisting staff timeExisting staff time income (above 120% AMI)income (above 120% Potential Operational -- isting staff time, Potential for igh Existing staff time, Potential for Existing staff time, Potential for Existing staff time, Potential for Existing staff time, Potential for Existing staff time, Potential for ExExisting staff time, Pote Funding and Staff Resources HighH ) AMI tor 120% AMI)120% -- 0 Housing & Building & & income (8income (80 Division -- CoordinatorCoordinator iddle Lead/ Partners Planning DivisionPlanning DivisionPlanning DivisionPlanning DivisionPlanning DivisionPlanning Division Implementation MiddleM Division, Building & Division, Building & Division, Building & Division, Division, Building & Division, Building & Housing & Homeless Housing & Homeless Division Homeless Coordina Economic Development Economic Development Economic Development Economic Development Economic Development Economic Development Economic Development Economic Development HighHigh 80% AMI)80% AMI) -- trative gislative income (60income (60 -- Needed LeLegislative AdministrativeAdministrativeAdministrativeAdminisAdministrativeAdministrativeAdministrativeAdministrative Type of Action ModerateModerate ModerateModerate based - LowLow focus group or income (below 60% AMI)income (below 60% AMI)rs, faith -- LowLow from a addresses Spokane Valley’s . to input . related permit fees. - Task Description informed by of technical experts oordinate with existing systems of care for effective homeless services implementation ermit and clarify tiny home regulations . C P old Incomes Targeted: 2: 3: the Comprehensive Plan Household Incomes Targeted: Ability to Reduce Displacement:HousehAbility to Reduce Displacement: evelop material summarizing the rationale and benefits for this Action CAction C Eliminate or reduce ADUEstablished approved ADU models to expedite permittingSeek code adoption and related Comprehensive Plan AmendmentsReview and modify land use and building codes to permit tiny homes in specific zones.Update site plan approval criteria to account for unique site needs of tiny housesworking groupDhousing typeDraft amendments and legislation and seek code adoption and related Comprehensive Plan Amendments.Update intention to supporting transitional housing.Identify best practices and potential siting requirements for shelters and transitional housingActively engage with existing service provideorganizations and regional bodies to coordinate housing resources. 61 9 11 termtermterm term, term, --- -- PAGE Timing ongoingongoing ShortShortShort Proposed ShortShort DRAFT ) AMI 0.75 FTE to manage Existing staff timeExisting staff timeExisting staff timeExisting staff time - program, City funded 0.5 income (above 120% Potential Operational - igh Funding and Staff Resources H ) AMI 120% eless - income (80 - CoordinatorCoordinatorCoordinatorCoordinatorCoordinator iddle Lead/ Partners Implementation M Housing & Homeless Housing & Homeless Housing & HomHousing & Homeless Housing & Homeless High 80% AMI) - income (60 - Needed Legislative Legislative, AdministrativeAdministrativeAdministrativeAdministrative Type of Action Moderate Moderate e sales urces and manag Low am income (below 60% AMI) - Low . etc.) are accessed. income households in areas of - ermine if the City should det , Task Description in Spokane Valley to moderate r displacement. - Develop a housing fund progr justify its creation. : to Spokane Valley’s role in the countywide approach to Household Incomes Targeted: Ability to Reduce Displacement: Action C4 Given addressing homelessnessits portion of the real estate excise tax fees to support the homeless communityIdentify and define the housing fund program including soof revenue, programmatic priorities, and staffing resources needed Evaluate the resources needed to staff the program.Ensure that its focus is on supporting the development and preservation of lowSpokane Valley that are served by transit or where households are at greater risk foEstablish and operate the program, initially with funds from and use tax fund for affordable and supportive housingexpand as new funds (taxes, grants, DRAFT 4.2 Use to Inform Housing Policy and Planning Projects Recommendations advanced in this HAP likely will inform future planning and zoning implementation projects that include modifications to development standards and allowances as well as area planning efforts. Spokane Valley could develop work plans and identify budget implications for recommendations provided in this HAPas an early step. Additionally, Spokane Valley should leverage near-term planning projects to advance this HAP’s recommendations. 4.3 Monitor Implementation Progress The city should track its progress toward achieving its housing goals by developing a set of indicators to track on a regular basis. Determining the exact indicators and monitoring frequency will require additional research into availability of data and availability of staff time and tracking systems, as well as discussions with city leaders and the community, to ensure that the chosen indicators adequately gauge equitable housing progress. Figure 18 provides examples of potential indicators that Spokane Valley could track. Figure 18. Potential Indicators for Future Exploration, by HAP Goal Goals Potential Indicators Potential Data Sources A.Preservation ofNumber of properties or units acquired by city, Community and agency Affordable Housingcounty, or nonprofit partnerpartners and Displacement Share of rent-burdened residents Census data Mitigation County of households on waiting lists for rent-Community and agency restricted units partners Number of requests the county receives for tenant Community and agency assistance from the Spokane Valley zip code partners People seeking and receiving education and City, Community and housing support on homeownership or the agency partners number of participants using a weatherization program Number of properties or units acquired or Assessor’s data, developed by city, county, or nonprofit partner community or agency partners B.Increase housingAmount of funding generated for affordable City, community or supplyhousing. agency partners Missing-middle housing development and split Assessor’s data between ownership and rental The number of housing units produced from MFTE City C.Increase housingNumber and type of new homes produced over Costar, Assessor’s data, choice.time—location, tenure, size, sale price/asking rent, Census data, or OFM accessibility, and unit type data Number of permitted ADUs and tiny homes City Share of homebuyers receiving assistance (e.g., Community partners down payment assistance) Home purchases by transaction type—cash vs. Home Mortgage mortgage by type (conventional, FHA, VA, etc.) Disclosure Act NOTE: Proposed performance measures will require additional discussion to confirm them as well as how to integrate data collection and analysis into ongoing staff workflow. Potential data sources include City of Spokane Valley, Spokane County, HMDA, the ACS, and proprietary sources (e.g., Costar and Property Radar). PAGE 62 UBC$7 APPENDIX A HOUSING NEEDS ASSESSMENT TQPLBOF!WBMMFZ IPVTJOH!BDUJPO!QMBO IPVTJOH!OFFET!BTTFTTNFOU TVNNBSZ!SFQPSU-!PDUPCFS!3131 City of Spokane Valley The City of Spokane Valley is developing a Housing Action Plan (HAP) to identify ways to meet housing needs now and into the future. The HAP is made possible due to a Washington State Department of Commerce Housing Bill 1923 Grant. The HAP will include strategies and implementing actions to encourage greater housing diversity and affordability, access to opportunity for residents of all income levels, and should address both affordable and market-rate housing needs. An of housing needs by analyzing the best available data In addition, housing markets function at a regional scale, that describes the area’s housing and associated which makes it challenging for individual jurisdictions to demographic, workforce, and market trends over the past adequately address issues without regional partnerships. few decades. This assessment helps answer questions about the availability of different housing types, who The following summary compares the City of Spokane lives and works in the Spokane Valley area, and what Valley with Spokane County and the City of Spokane range of housing is needed for all income levels through to provide a more complete picture of the county-wide 2037, the planning horizon for the HAP which is also housing landscape while also offering insights on aligned with the 20-year growth target for the City of localized versus regional trends, and a more nuanced view Spokane Valley Comprehensive Plan. Housing analysis of housing market dynamics. Various U.S. Census Bureau, is an important exercise since a community’s housing county assessor, and housing market datasets were used needs tend to continually evolve based on changes in the to assess the housing stock, workforce, demographics, broader economy, local demographics, and regulatory and expected demand. The housing needs assessment environment. The City of Spokane Valley, like other communities in the •Executive Summary Spokane County region, has changed and grown over the •National Trends years, leading to greater demand for different housing •Spokane Valley Housing Trends types. Analyzing housing needs is complex because it •Spokane Valley Demographics represents a bundle of services that people are willing to •Spokane Valley Housing Affordability or able to pay for, including shelter and proximity to other •Spokane Valley Housing Needs Forecast attractions (e.g., jobs, shopping, recreation); amenities •Spokane Valley Workforce Trends •Spokane County Trends landscaping, views); and access to public services maximize all of these services while minimizing costs, households must make decisions about trade-offs and can afford. 2 Djuz!pg!Tqplbof!Wbmmfz!!!}!!!!Ipvtjoh!Offet!Bttfttnfou Executive Summary are more likely to live in single-person households which ›Spokane Valley’s population growth and housing development has remained steady for most of the decade.tend to be smaller in size. The aging of the Baby Boomer From 2010 to 2018, Spokane Valley’s population grew bygeneration (born 1946-1964) could generate greater demand for living assistance and low-maintenance 7%, adding 6,055 new residents. (Demographics Section). middle housing options such as townhomes. (County ›The City of Spokane Valley needs about 6,660 newTrends Section). housing units by 2037 when its population is expected to reach about 109,913 people. This includes 1,463 housing›Household incomes have increased in Spokane Valley. units to address housing underproduction over the lastSpokane Valley’s median household incomes for owners grew by nearly 25% between 2012 and 2018 (from decade. Around 351 units per year should be produced through 2037 to meet forecast housing needs which$61,873 to $77,299). Renter incomes increased too by means slightly more would need to be built per year thanalmost 12% from $34,417 to $38,498 during the same time period. Overall, these trends indicate increasing the average produced from 2010 and 2019 (345 housing units built per year). Spokane Valley should continue topressure on the already limited supplies of moderate support robust housing growth and advance strategies inand middle-income housing (60-120% AMI) and if they support of housing growth for a diversity of housing types and affordability levels. (Housing Forecast Section).households across the City. (Affordability Section). ›Population growth coupled with housing ›Housing needs change over a person’s lifetime. It is important to track shifts among the share of different ageunderproduction throughout Spokane Valley and the groups to better comprehend how housing needs changeregion has added pressure on an already limited housing supply and contributed to rising housing costs. While as community demographics fluctuate. Spokane Valley’s millennial population (25-34 years) almost doubled,rents have grown more than 15% since 2010 in the city, growing substantially from 10% to 15% of the populationhome prices increased by more than 48%. The escalating total (from 12,148 to 21,144 persons). Millennial population growth could explain the decline in Spokanefew options of housing affordable at their income level. Valley’s median age to 35.2 years by 2018, a rate belowHome-ownership is increasing becoming out of reach the Washington State and Spokane County’s median age of almost 38 years. (County Trends Section). burdened, meaning they pay more than one-third of their gross income for housing. ›Another growing sector is the senior population (65+). During 2012-2018, seniors grew from 13% to 15% of the total population settling at an estimated total of 20,910›Affordable housing problems have not affected all households evenly. Low and moderate-income persons, a total similar to the millennial population sector. Spokane County projections from 2020 to 2030 estimatehouseholds have been disproportionately affected. In fact, that the 65+ population will expand from 18% to 22% ofover 65% of extremely low-income households renting and owning were severely cost burdened, meaning paying the total population – a trend that is consistent with other communities across the country. Homeownership ratesmore than 50% of their income on housing. In addition, increase as age increases and younger and older people83% of low-income renters (30-50%), 56% low-income 3 Ipvtjoh!Offet!Bttfttnfou!!!}!!!!Djuz!pg!Tqplbof!Wbmmfz Executive Summary home owners, and over one-third of moderate-income (60-120% AMI) that can mostly be met through single- family attached housing (e.g., townhomes and quad (50-80%) owners and renters were cost burdened, homes) and housing serving senior’s needs. meaning paying more than 30% of their income on housing. Overall, the low-to-moderate income households (less than 80% of AMI) tend to be more cost-burdened. (Affordability Section). Median Income Levels* When examining household income levels, the Area ›Spokane Valley’s housing stock mostly consists of Median Income (AMI) and Median Family Income (MFI) are helpful benchmarks for understanding what different single-family detached homes (66%) and lacks housing households can afford to pay for housing expenses. diversity needed to accommodate future demand Since housing needs vary by family size and costs vary particularly associated with aging baby boomers and by region, HUD produces a median income benchmark young households forming. The city has a low supply (9%) for different family sizes and regions on an annual basis. of “missing middle” housing (e.g., townhomes, duplexes, These benchmarks help determine eligibility for HUD quad homes, and cottages) which allows more seniors housing programs and support the tracking of different to downsize and remain in their community, while also housing needs for a range of household incomes. providing more options for working families to get a •The median income value (100%) primarily used for this foothold in great neighborhoods. (Housing Section). analysis is an annual income of $65,200 for a family of four (Spokane County rate for 2018). ›Between 2012 and 2018, the share of 2 and 4-person •Below 30% of AMI is extremely low income (under households grew in Spokane Valley, while the number $19,560), 30 to 50% of AMI is very low income ($19,560- of 1-person households fell. In contrast, the City of $32,600), 50 to 60% of AMI is low income ($32,600- Spokane’s share of 1 to 3-person households grew. This $39,120), 60 to 80% of AMI is moderate income trend shows Spokane Valley’s housing tilting towards ($39,120-$52,260), 80 to 120% AMI is middle income 2-bedroom housing and larger family-friendly housing ($52,260-$78,240), and above 120% AMI is high income with at least 2 bedrooms. (Demographics Section). (above $78,240). •To put these numbers into perspective, a dishwasher ›Spokane Valley’s workforce, including around 51,305 earns an estimated $26,580 per year on average and workers, increased by 11% from 2010-2017. Growth in would be very low income. A pharmacy tech earns $40,940 industry sectors with salaries below 100% AMI is fueling annually and would be moderate income in the cities of demand for moderate-to middle-income housing. Spokane and Spokane Valley metropolitan area. •Income levels tend to vary throughout a lifetime and ›As a result of the shifting demographics in Spokane homeownership rates tend to increase as income Valley, at least 6,660 housing units are needed by 2037. increases. If units are allocated based on recent income distribution *Source of AMI: Spokane County/US Housing and Urban trends, the majority of new housing units needed through Development (HUD), 2018, and Occupational Employment 2037 would be for households earning over 100% AMI Statistics, US Bureau of Labor, 2019, Spokane-Spokane Valley Metropolitan.https://static.spokanecity.org/documents/chhs/ (56% of total units), and one-third of the total should be programs/homeinvestment/2018-spokane-home-income- and-rent.pdf demand for moderate to middle-income housing options 4 Djuz!pg!Tqplbof!Wbmmfz!!!}!!!!Ipvtjoh!Offet!Bttfttnfou National Housing Trends Key National Demographic Trends Associated with Housing In addition, around one-third of Americans between Nuclear family households, the predominant type of 18-34 years are living in their parent’s homes (as of household of the mid 20th Century, shrunk from 40% in 1970 to 20% in 2018 while the share of single-person to almost 30 in 2016. This trend could decrease housing households increased from 15% in 1970 to 28% in 2018, demand for 18-34 aged persons or at least delay it. to take over as being the most prevalent household type. This trend could lead to fewer persons per household which would increase demand for housing units. America is aging, and the number of seniors will Nationwide, the Hispanic/Latino population is predicted continue to grow over the next few decades to an to be the fastest growing racial/ethnic group over the estimated share of around 22% over age 65 by 2050. next few decades and these households tend to include This is a big increase since only around 16% of US multiple generations, requiring more housing space. (and Washington state) residents were over 65 in 2018. Over the coming decade, minorities will make up a larger share of young households and constitute an important time ever by 2035.source of demand for both lower-cost rental housing and home-ownership opportunities. consistently which will likely exacerbate housing availability and stability. Parts of this analysis relied on pre-COVID data. Sources: AARP (2018) Making Room for a Changing America, U.S. Census Bureau Annual Social and Economic Supplements 1950 and 5 Ipvtjoh!Offet!Bttfttnfou!!!}!!!!Djuz!pg!Tqplbof!Wbmmfz Spokane Valley Housing Trends Number of Units Built by Year, 2010-2019 38,730 Number of total housing units as of mid 2020 Source: Spokane County Assessor, 2020 345 3,445 Average Number of housing units built between 2010-2019 Source: Spokane County Assessor, 2020 Source: Spokane County Assessor, 2020 345 Housing Type Built by Decade, as of Mid-2020 New housing units built on average every year since 2010 9-111 Source: Spokane County Assessor, 2020 7-111 5-111 1.04 City Ratio of Housing Units 3-111 to Households ›Between 2010-2019 1 Finance and Management (OFM), 2019, ECONorthwest calculations. Note: The housing units to household ratio should 23!up!56!up!3:41!up!5:61!up!::211!, be above one since healthy housing markets should have more housing Housing Scale units to allow for vacancy, demolition, Source: Spokane County Assessor, 2020. Note: Housing with 5 or more units is second/vacation homes, and broad considered multifamily and housing with 5 or less units is single-family absorption trends. Because Wash- ington State does not have a regional approach to planning for housing Share of Housing By Type, as of Mid-2020 production, ECONorthwest compared this city ratio to the Spokane County Housing TypeAverage Age % of Housing ratio of 1.07 to determine the amount Single-family Detached4666% of housing underproduction. Apartment/Condo3620% Single-family Attached389% Mobile/Manufactured Home385% Source: Spokane County Assessor, 2020. Note: Single-family attached includes duplexes, triplexes, and quad homes. 6 Djuz!pg!Tqplbof!Wbmmfz!!!}!!!!Ipvtjoh!Offet!Bttfttnfou Spokane Valley Housing Trends Age of Housing by Type Single-Family DetachedSingle-Family AttachedApartment Average Year Built Source: Spokane County Assessor, 2020 Type of Housing Built by Decade, as of Mid-2020 Year Built Source: Spokane County Assessor, 2020. 7 Ipvtjoh!Offet!Bttfttnfou!!!}!!!!Djuz!pg!Tqplbof!Wbmmfz Spokane Valley Housing Trends Housing Type ›Overall, Spokane Valley lacks housing diversity particularly due to low supplies of single-family attached housing (comprising 9% of the total housing) such as town homes, triplexes, and cottages in single-family areas. The city could encourage the development of a variety of housing types and sizes to accommodate the diverse needs of residents through their changes in age and family size. Housing Type Housing Units Built as of Mid-2020 Percent of Decade Units Source: Spokane County Assessor, 2020 Before 19404% Housing Unit Density 1940’s6% 1950’s11% 1960’s6% 1970’s20% 1980’s11% 1990’s18% 2000’s14% 2010’s10% Source: Spokane County Assessor, 2020. 6% Unit Count Change in number of households 20122018 Households36,36538,478 Source: OFM, retrieved in 2020 Source: Spokane County Assessor, 2020 8 Djuz!pg!Tqplbof!Wbmmfz!!!}!!!!Ipvtjoh!Offet!Bttfttnfou Spokane Valley Demographics Change in Household Size, 2012 & 2018 7% Change in population 20102018 Population89,75595,810 Source: OFM, retrieved in 2019. 12% Change in median renter 1234 Household income People per Household 20122018 Source: PUMS (2012, 2018) Median $34,417 $38,498 Income Distribution by AMI, 2012 & 2018 Income Source: PUMS (2012, 2018). Note: All values are in 2018 inflation-adjusted dollars. 25% Change in median owner household income 20122018 Median $61,873 $77,299 Income Source: PUMS (2012, 2018) Source: PUMS (2012, 2018). Note: All values are in 2018 inflation-adjusted dollars. Income Distribution by AMI and Tenure, 2018 48% Increase in median home sales price 20102020 Median $202,461 $300,000 Sales Price Source: Spokane County Assessor, 2020. Values are in 2020 inflation adjusted dollars. Share of Households Notes: A household would need to earn over 100% AMI to afford the 2020 median home sales price. The Zillow Home Valley Index shows a 59% increase between 2010-2020 to $283,374 for middle price-tiered homes. Source: PUMS, 2018 9 Ipvtjoh!Offet!Bttfttnfou!!!}!!!!Djuz!pg!Tqplbof!Wbmmfz Spokane Valley Housing Affordability Share of Cost Burdened and Severely Cost Burdened Cost Burdened Households by Tenure, 2018 ›A household who pays more than 30% of their income on housing. Severely Cost Burdened ›A household who pays more than 50% of their income on housing. 1,663 Number of income restricted housing units as of mid-2020 Source: ECONorthwest analysis of public affordable housing data. Note: Restricted to low and moderate-household incomes. Household Income as a % of AMI 15% Increase in average rent for Source: PUMS, 2018. Notes: Low and moderate-income households below 2-bedroom apartment 50% AMI tend to be more cost burdened and higher incomes above 100% AMI less since their larger income go further to cover expenses. Owners tend to be 20102020 less cost burdened due to mortgage lending stipulations; however it can occur Average when households with mortgages see income decline. Cost burden does not $983 $1,131 Rent consider accumulated wealth and assets. Source: Costar. All values are in 2020 infla- Housing Units Affordable by AMI and Tenure, 2018 tion-adjusted dollars. Notes: Average rents for a 2-bedroom apartment in Spokane County increased by 13% during the same time period. This 2020 average rent would be affordable to those earning 65% AMI or more. 5.2% 2-bedroom apartments were vacant as of mid-2020 Source: Costar, Bureau of Labor Statistics. Notes: On average during the last decade, the vacancy rate was 5.4% for 2-bedroom apart- ments. This is a standard rate of vacancy, indicating that the supply for this product type should be adequate to meet demand. This trend is similar to county and state rates. Source: PUMS, 2018 10 Djuz!pg!Tqplbof!Wbmmfz!!!}!!!!Ipvtjoh!Offet!Bttfttnfou Spokane Valley Housing Affordability Financially Attainable Housing Types Another way to evaluate housing needs is to consider the different types of housing generally affordable to different household incomes in comparison to the current housing stock. As shown in the below exhibit, the 2018 area median income was $65,200 for a family of four in Spokane County (100% AMI). •Housing types affordable to households below this median annual income tend to be limited to apartments, manufactured homes, multiplexes (duplexes, triplexes, and quad homes) and townhomes. Much of this housing is rented, particularly when priced for lower income households earning below 80% AMI and most of the housing below 50% AMI (extremely low and very low income) tends to be government subsidized. •Around 44% of all the City of Spokane Valley households in 2018 need housing priced below the median income (100% AMI), yet this housing is inadequate since only 3% of the current housing stock includes multiplexes, townhomes, apartments, and manufactured homes. •Housing above the median income is predominantly newer construction and owner-occupied. This housingtypically includes single-family detached homes, higher-priced single-family attached homes, and condominiums. Households earning above the median income tend to have more housing options available to them especially when considering that most of the current housing stock is single-family detached (around 66% in the City of Spokane Valley). Most Spokane Valley residents living in single-family detached housing own their home (86%) rather than rent (ACS 1-Year, 2018). Source: ECONorthwest. Note: All values are in 2019 inflation-adjusted dollars. 11 Ipvtjoh!Offet!Bttfttnfou!!!}!!!!Djuz!pg!Tqplbof!Wbmmfz Spokane Valley Housing Needs Forecast Housing Units Needed Through 2037 109,913 UnderproductionFuture NeedHousing Need Projected population by 1,4635,1976,660 2037 (medium projection) Source: *Population Projections Appendix Source: PUMS, 2018; *Appendix; ECONorthwest Calculation. Note: Underproduction is the estimated number of housing units needed to 742 Average annual population Housing Units Needed as a Share of Existing Stock growth projected from 2018 Existing UnitsHousing Need% of Existing Units to 2037 38,7306,66017% Source: OFM, 2019; *Population Projections Appendix; ECONorthwest calculation Source: Spokane County Assessor, 2020; ECONorthwest Calculation Housing Units Needed by AMI Through 2037, Based 6,660 on 2018 Trends Projected number of units AMI# of Units% of Units needed by 2037 0-30% 5508% Source: OFM, 2019; *Population Projections Appendix; ECONorthwest Calculation 30-50%6259% 50-80%1,03916% 351 80-100%68610% Average number of new units needed to add 100%+3,76056% annually from 2019 to 2037 Source: PUMS, 2018;*Appendix; ECONorthwest Calculation Source: OFM, 2019; *Population Projections Appendix; ECONorthwest Calculation. This HUD Affordability Level by Housing Type, 2018 number is higher than the 345 average housing units built from 2010-2019. AMIStudio1-bed2-bed3-bed 30%$342$366$440$509 2% 50%$570$612$734$848 Increase in annual housing production to reach 2037 80%$912$978$1,174$1,356 housing need forecast 100%$1,140$1,222$1,468$1,695 *City of Spokane Valley Appendix A: SEPA Analysis 2017-2037 Source: HUD, 2018. Notes: The dollar values are for Spokane County and the Comprehensive Plan AMI values were adjusted to include the family size that would be appropriate for the housing type. These are fair market rent values. 12 Djuz!pg!Tqplbof!Wbmmfz!!!}!!!!Ipvtjoh!Offet!Bttfttnfou Spokane Valley Employment Trends Employment Trends commuting trends helps provide insights on the housing needs of workers today and into the future. Factors such as job sector growth and the city’s commuting patterns may have implications for how many people are able to both live and work within the city. If such factors indicate many people are commuting into the city for work, it could be possible that the city does not have enough housing to accommodate its workforce or enough housing matching their needs and affordability levels. trends associated with workforce and wage growth. • As shown in the employment table, an estimated total of 51,305 people are part of the workforce in the City *Transit and drive time of 45 minutes or less, departing at 7:00 AM, mid-week of Spokane Valley as of 2017. Overall jobs grew by around 11% from 2010 - 2017 in the city. Source: US Census LODES database, 2017 and census block • Among this total, the largest share works in retail geometries, 2010; Spokane Transit Authority database; ECONorthwest Calculations. trade (almost 20% of total), manufacturing (13%), and health care/social assistance sectors (12%). This analysis demonstrates how a large majority of jobs • Removing small job sectors (below 5% of the total), are more accessible by driving an automobile rather than the employment sectors experiencing high increases taking public transit. In total, 260,178 jobs are within a in job growth between 2010-2017 were educational 45-minute drive from the City of Spokane Valley while services (120%) and construction sectors (45%), both far fewer jobs, estimated at 63,115, are located within with an average salary below $50,000, which could the 45-minutes transit shed. One quarter of the jobs indicate increasing demand needed for housing below are available via transit compared to driving within 45 100% AMI (such as moderate-income housing). minutes or less from the original location. The denser urban areas within the small orange area could be Access to Employment* analyzed for potential opportunities to include housing Transit and auto access to regional employment was development that is more transit-oriented. Mapping out derived using 45-minute travel sheds for each mode. commute sheds can be useful for estimating the extent of ECONorthwest calculated the number of jobs available the regional housing market since most employed home within these travel sheds in each industrial sector catego- buyers and renters tend to search for units with their ry for the Spokane County region (2-digit NAICS). commute in mind. The transit travel sheds originated from every transit stop within the city while the auto travel sheds originated from the center of all block groups in the city. 13 Ipvtjoh!Offet!Bttfttnfou!!!}!!!!Djuz!pg!Tqplbof!Wbmmfz Spokane Valley Employment Trends Access to Regional Spokane Valley Employment Numbers Employment Industry (2-digit NAICS Code)Employees %# Change% ChangeAverage Salary% Jobs by % Jobs by (2017)(2010-2017)(2010-2017)(2018)AutoTransit Agriculture, Forestry, Fishing and 1.1%513777%$34,44488%19% Hunting Mining, Quarrying, and Oil and Gas 0.2%3569%$31,46793%14% Extraction Utilities 0.6%4619%$69,93692%21% Construction 6.1%97845%$46,683 93%15% Manufacturing 13%-172-3%$46,532 96%16% Wholesale Trade 7.1%68423%$44,029 98%24% Retail Trade 19.6%-278-3%$33,90497%27% Transportation and Warehousing 3.9%37523%$49,020 97%10% Information 0.8%-127-23%$40,373 97%24% Finance and Insurance 4%34320%$43,927 99%36% Real Estate and Rental and 1.2%5910%$31,836 97%30% Leasing 2.8%28926%$48,292 97%31% Technical Services Management of Companies and 1.2%29387%$46,964 98%24% Enterprises Administrative and Support and Waste Management and 7.8%60018%$31,520 97%29% Remediation services Educational Services 7.1%1,978120%$48,057 93%22% Health Care and Social Assistance 12.2%-409-6%$41,440 98%23% Arts, Entertainment, and 0.3%-116-42%$34,583 71%9% Recreation Accommodation and Food 7.5%2998%$28,307 97%26% Services Other Service 2.5%-102-7%$31,734 96%24% Public Administration 0.9%-188-28%$52,425 97%13% Source: US Census LODES database, 2017 and census block geometries, 2010; ECONorthwest. Note: Median earnings was sourced from ACS 2018 5-year estimates at the tract level, joined to jurisdictional boundaries and employees within that industry/jurisdiction pair. The estimated total number of Spokane Valley employees in 2017 is 51,305. The 2019 average annual salary for Spokane County was $50,234 (includes all industries) and this means housing below 80% of the AMI would be affordable to those earning this average salary. 14 Djuz!pg!Tqplbof!Wbmmfz!!!}!!!!Ipvtjoh!Offet!Bttfttnfou Spokane Valley Commuting Trends Commuting Flow, 2017 ›Approximately 32% of Spokane Valley’s workforce lived and worked in Spokane Valley in 2017. This share increased above 2010 levels (26%). ›Around 40,029 workers (74%) of the total City of Spokane Valley workforce live elsewhere and commute into Spokane Valley for work while 30,476 workers (26%) live in Spokane Valley and commute elsewhere for their work. ›Among those working outside Source: US Census LODES database, 2017; Census On the Map. Note: Dark of Spokane Valley, 37% work in green arrow is showing persons commuting into town (40,029) and the light green arrow (30,476) shows persons commuting out of town. Spokane, 5% work in Liberty Lake, 2% work in Seattle, and 2% work in Coeur d’Alene, Idaho. Around Commuting Trends, 2017 1% of the workforce commutes to , and Cheney. The remaining 19% commutes to other locations. ›The high rate of commuting to the City of Spokane Valley could be due to a shortage of affordable housing or suitable housing not meeting the needs of the workforce or it could mean they prefer living elsewhere in the region. Source: US Census LODES database, 2017; Census On the Map 15 Ipvtjoh!Offet!Bttfttnfou!!!}!!!!Djuz!pg!Tqplbof!Wbmmfz Spokane County Trends Change in Household Size, 2012 & 2018 8% Change in population ›Between 2010 and 2018 20102018 Population471,221507,950 Source: OFM, retrieved in 2020 1234 People per household 7% Change in number of households Source: PUMS (2012, 2018) ›Between 2012 and 2018 Income Distribution by AMI, 2012 & 2018 20122018 Households 196,529209,897 Source: OFM, retrieved in 2020 21% Change in median renter Household income ›Between 2012 and 2018 20122018 Source: PUMS (2012, 2018) Median $28,726 $34,749 Income Income Distribution by AMI and Tenure, 2018 Source: PUMS (2012, 2018). Note: All values are in 2018 inflation-adjusted dollars. 9% Change in median owner household income ›Between 2012 and 2018 20122018 Median $68,833 $74,969 Income Source: PUMS (2012, 2018) 16 Djuz!pg!Tqplbof!Wbmmfz!!!}!!!!Ipvtjoh!Offet!Bttfttnfou Spokane County Trends Population by Age, 2012 & 2018 13% Tqplbof!Dpvouz Tqplbof! Tqplbof!Wbmmfz! Change in average rent for 211& 24& 25& 26&26& 27& 2-bedroom apartment 28& :1& ›Between 2010 and 2020 91& 24&25& 23& 24& 24& 24& 20102020 81& Average 36& 71& 38&38& $968 $1,094 39& 37& 36& Rent 61& Source: Costar. Note: All values are in 2018 24& inflation-adjusted dollars. 23& 51& 21& 26& 25& 26& 41& :& Share of Households 22& 23&8& :& 21& 31& 2:& 29& 27&26& 50% 27& 25& 21& Change in median home 8& 8&8& 7& 7& 6& 1& 312331293123312931233129 sales price Voefs!6!zfbst6!up!29!zfbst29!up!35!zfbst36!up!45!zfbst ›Between 2010 and 2020 46!up!55!zfbst56!up!75!zfbst76!zfbst!boe!pmefs 20102020 Source: ACS(2012, 2018); PUMS 1-Year Estimates Median $184,000$275,000 Sales Price Cost Burdened and Severely Cost Burdened by Source: Spokane County Assessor, 2020. Tenure, 2018 Note: All values are in 2018 inflation-adjusted Owners dollars. 211& :2& Dptu!CvsefofeTfwfsfmz!Dptu!Cvsefofe 85& 91& 67& Housing Units Built by 71& 49& Decade, as of Mid-2020 51& 36& 27& 31& 22& DecadePercent of Units 6& 1&1& Share of Households 1& Before 194011% 1940’s5% Renters 1950’s8% 211& 97& 94& 1960’s5% 91& 77& 1970’s15% 71& 58& 4:& 1980’s10% 51& 1990’s19% 24&24& 31& Share of Households :& 4& 1& 2000’s17% 1& 1.41&41.61&61.91&91.211&211&, 2010’s9% Household Income as a % of AMI Source: PUMS, 2018 Source: Spokane County Assessor, 2020 17 Ipvtjoh!Offet!Bttfttnfou!!!}!!!!Djuz!pg!Tqplbof!Wbmmfz Spokane County Trends Commuting Flow, 2017 ›About 82%, or 139,710, of Spokane County residents live and work in Spokane County. ›About 18%, or 31,388 of Spokane County residents work outside Spokane County. ›Most of Spokane County residents work in City of Spokane or City of Spokane Valley. Source: US Census LODES database, 2017; Census On the Map. Note: Dark green arrow is showing persons commuting into town (45,333) and the light green arrow (31,388) shows persons commuting out of town. Cities Where Spokane County Residents Work, 2017 Dpfvs!e(Bmfof-!JE 2& Nfejdbm!Mblf-!XB 2& Difofz-!XB 3& Bjsxbz!Ifjhiut-!XB 3& Tfbuumf-!XB 3& Mjcfsuz!Mblf-!XB 4& Tqplbof!Wbmmfz-!XB 29& Bmm!Puifs!Mpdbujpot 35& Tqplbof-!XB 58& 1&31&51&71& Source: US Census LODES database, 2017; Census On the Map 18 Djuz!pg!Tqplbof!Wbmmfz!!!}!!!!Ipvtjoh!Offet!Bttfttnfou UBC$8 APPENDIX B HOUSING NEEDS ASSESSMENT METHODS AND DATA SOURCES ! EBUF;!!Tfqufncfs!39-!3131! UP;!Djuz!pg!Tqplbof!Wbmmfz! GSPN;!FDPOpsuixftu! TVCKFDU;!IPVTJOH!OFFET!BTTFTTNFOU!NFUIPET!NFNP!! Cbdlhspvoe!boe!Qvsqptf! Gjhvsf!2/!Tuvez!Bsfb! Tpvsdf;!FDPOpsuixftu! FDPOpsuixftu!}!Qpsumboe!}!Tfbuumf!}!Mpt!Bohfmft!}!Fvhfof!}!Cpjtf!}!fdpox/dpn!2! ! ! Efgjojoh!uif!Tuvez!Bsfb! Ebub!Tpvsdft! FDPOpsuixftu!!3!! ! ! Bobmztjt!Nfuipet! Upubm!Ipvtjoh!Vojut!Offefe!! Gjhvsf!3/!Upubm!Offefe!Ipvtjoh!Vojut!! Dvssfou!Voefsqspevdujpo! FDPOpsuixftu!!4!! Upubm!Vojut!Offefe!cz!Jodpnf! Fnqmpznfou!Bobmztjt! FDPOpsuixftu!5!! ! ! Bddftt!up!Fnqmpznfou! Usbotju!Jtpdispoft! Bvup!Jtpdispoft! Tibsf!pg!Kpct!Bddfttjcmf!! Dbwfbut! FDPOpsuixftu!!6!! UBC$9 APPENDIX C HOUSING POLICY FRAMEWORK MEMORANDUM To: Chaz Bates, City of Spokane Valley Date: November 4, 2020 Revised January 29, 2021 From: Matt Hoffman Project No.: 1932.01.01 Ben Johnson, AICP RE: Housing Policy Framework Review The City of Spokane Valley (City) is developing a Housing Action Plan (HAP) to evaluate current and future housing needs and identify strategies to meet these needs. This memorandum meets the housing policy framework review (Review) requirements defined by Revised Code of Washington (RCW) 36.70A.600(2) for completing a HAP. This Review identifies existing housing goals, policies, and strategies from the 2017 Spokane Valley Comprehensive Plan (Comp Plan) as well as housing programs and incentives currently available to encourage greater housing supply and the development of affordable housing in the city. Figure 1: Context Map This Review contains three sections: Section 1: A review of the Comp Plan Housing Element goals and policies Section 2: Regulatory review Section 3: Summary of findings The information will be used alongside the housing needs assessment and input from community members and stakeholders in developing strategies and policies to meet the cityÔs unique housing needs and to complete the HAP. 2815 2nd Avenue, Suite 540, Seattle, WA 98121 www.maulfoster.com R:\\1932.01 City of Spokane Valley\\Documents\\01_2021.01.29 Policy Memo\\Mf_Policy-Regulatory Memo_v3.docx Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 2 SECTION 1. COMPREHENSIVE PLAN POLICY AND GOALS REVIEW In its Comp Plan, the City has identified three goals COMMUNITY SNAPSHOT and four priorities specifically related to housing. 2 ¤Land Area: 38.5mi Other elements of the Comp Plan, particularly the ¤Population: 95,810 Land Use element, deal with several other goals and ¤Total Employment: 46,573 policies related to housing. ¤Key Employment Industries: Î Retail Trade (19.6%) Four housing themes identified in the Comp Plan Î Health Care/Social Assistance (12.2%) are evaluated in this section. For each theme, the Î Manufacturing (13.0%) Comp Plan goals, policies, and strategies are ¤Median Age: 35.2 presented, followed by a description of actions ¤Educational Attainment taken by the City since the adoption of the Comp Î High School or Higher: 91.9% Î BachelorÔs or Higher: 20.9% Plan to advance housing objectives. Each theme ¤Median Household Income: $48,274 concludes with an assessment of the progress achieved by the City to date. A complete list of Sources: Washington OFM (2019); Employment Security Department/LMEA; U.S. Bureau of Labor Statistics, Local housing-related goals, policies, and strategies is Area Unemployment Statistics; U.S. Census ACS (2014); U.S. Census LEHD (2014). provided in Attachment A. Housing Theme 1: Ensure a Range of Housing Options for Residents Comp Plan Policies, Goals, and Strategies During the development of the Comp Plan, community members identified a need for a greater diversity of housing types to serve people at all income levels and stages of life. The following Comp Plan goals and policies relate to housing variety: H-G1: Allow for a broad range of housing Abbreviation Key opportunities to meet the needs of the Abbreviation Definition community. HHousing Element H-P2: Adopt development regulations that LU Land Use Element expand housing choices by allowing GGoal innovative housing types, including tiny PPolicy homes, accessory dwelling units, Goals = broad statements of purpose. prefabricated homes, cohousing, cottage Policies = staff direction. housing, and other housing types. Strategies = initial actions. LU-P14: Enable a variety of housing types. Demographic shifts identified in the housing needs assessment underscore the importance of H-G1 and the related policies. Spokane ValleyÔs millennial population (ages 25 to 34) almost doubled, growing substantially from 10 percent to 15 percent of the population total (from 12,148 to 21,144 persons) between 2012 and 2018. These households will continue to seek starter homes and homes Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 3 for growing families. On the other end of the spectrum, the senior population (65 and over) is expected to grow by approximately 11,500 people between 2020 and 2040. This age group could generate greater demand for living assistance and low-maintenance middle housing options such as townhomes. In addition to the policies and goals listed above, the Comp Plan featured a strategy to Ñcontinue to evaluate new housing typologies to meet market needs.Ò One example of how this strategy is being implemented is through the HAP, which is planned to be finalized by June 30, 2021. Actions Taken In June 2016, the City implemented new zoning regulations to allow for a variety of housing types targeting smaller and more affordable housing options for first-time home buyers, young families, and renters not eligible for subsidized housing. They are also referred to as Ñmissing middle housing types.Ò Examples of these housing types can be found in Attachment B. The 2016 regulations allowed ADUs, cottage Missing Middle Housing Types Defined housing, duplexes, manufactured homes on both Missing middle housing types provide diverse individual lots and in home parks, and housing options, such as duplexes, fourplexes, townhouses. Duplexes were permitted in the cottage courts, and multiplexes. These house- scale buildings fit seamlessly into existing denser residential (R) districts, Residential-3 (R- residential neighborhoods and support 3), and Multifamily Residential (MFR) and walkability, retail, and public transportation mixed-use districts. The other alternative housing options. They provide solutions along a types, including cottage housing, ADUs, and spectrum of affordability to address the manufactured homes, were allowed in residential mismatch between the available U.S. housing stock and shifting demographics, as well as the and nonresidential zoning districts throughout growing demand for walkability. the city, if developments complied with the Source: https://missingmiddlehousing.com supplemental development regulations. New duplex developments in the city since 2016 raised concern among residents about the negative impacts duplex development may have on the character of certain existing single-family neighborhoods. As a result, the City amended its zoning regulations during the 2020 annual Comp Plan update. The revisions prohibit cottage housing, townhomes, and assisted-living facilities in R-3 single-family residential districts. Duplexes, ADUs, and manufactured homes are still permitted under the supplemental use regulations in the R-3 district. The 2020 amendment increased the allowable density for detached single-family homes from six dwelling units per acre to eight dwelling units per acre while maintaining the allowable density for ADUs and manufactured homes. The minimum lot size for a duplex was increased from 10,000 square feet to 14,500 square feet. These new restrictions in the R-3 district were offset by creating a new residential zone, R-4, that allows greater density and alternative housing types, specifically targeting areas served by transit. When Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 4 viewed comprehensively, these revisions to the zoning regulations address the goals of allowing for a range of housing types, creating density around mixed-use areas, and protecting existing neighborhood character. Overall, a broader range of housing options can be built in different zones (including duplexes, cottage housing, ADUs, townhouses, manufactured homes) in more areas than allowed before 2016. Evaluation of Progress The City has advanced H-G1, as construction of a variety of missing middle housing types is now permitted in the Single-Family-Home Dominant city. Since 2016, most of the new housing units have been The current overall distribution of housing options in the city is multifamily apartments and duplexes; other product types weighted heavily toward single- such as cottage housing, townhomes, ADUs, and family homes, which comprise 66 manufactured homes have not been introduced to the percent of the total dwelling units as market. It is important to understand that development type of mid-2020 (approximately 25,665 single-family units out of 38,787 total allowances in zones will only be delivered when both units, Spokane County Assessor). market demand supports targeted housing types and there is enough zoned capacity with the right site characteristics. Since 2016, a total of 1,941 units have been constructed, with 42 percent of new units (808) being multifamily apartments. Attached single-family homes and homes with more than one unit but fewer than five have represented 22 percent (427 units) of the total units constructed (Figure 2). Figure 2: Housing Option Unit Distribution TotalDwellingUnitsTotalBuiltSince2016 Condominium,2% ADU,0%Apartment, Single 18% family,33% Apartment, 42% Attachedsingle family,9% Singlefamily, 66% Attachedsingle Condominium,0% family,22% Mobile/manufacturedhome, 4% ADU,2% Mobile/manufactured home,2% Source: Spokane County Assessor, ECONorthwest, Maul Foster & Alongi, Inc. Before 2016, only 13 percent of the cityÔs housing stock represented one of the missing middle housing types. Since 2016, nearly 25 percent of all new dwelling units have been missing middle housing types (as shown in Table 1.) Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 5 Table 1: New Housing Types Constructed since 2016 Type Units Percent of Subtotal Percent of Overall ADU30 6.1%1.5% Cottage0 0.0%0.0% Duplex384 77.9%19.8% Triplex/Fourplex173.4%0.9% Townhomes26 7.3%1.3% Manufactured Homes 36 5.3% 1.9% Housing Types Missing Middle Subtotal 493 100% 24.5% Apartment 808 42.5% Single Family 64033.0% Overall Built Since 2016 1,941 Source: Spokane County Assessor, ECONorthwest, Maul Foster & Alongi, Inc. Table 1 shows that since 2016, the market has responded to demand and delivered more attached single-family units. The majorityÐ78 percentÐhave been duplexes. Despite policies supporting the construction of broadened housing options, built housing has largely been limited to single-family homes, multifamily apartments, and duplexes. This could be related to a slower adoption of these housing types by local developers and lack of education on new housing products such as ADUs, townhouses, and cottage housing. Housing Theme 2: Improve Housing Affordability Comp Plan Policies, Goals, and Strategies The current Comp Plan includes a goal to allow for a diversity of housing options that are affordable to households at all income levels.Housing affordability remains relevant todayH-G2 as well as two of the housing policies in the Comp Plan address the development of affordable housing. H-G2 Enable the development of affordable housing for all income levels. H-P3 Use available financial and regulatory tools to support the development of affordable housing units. H-P4 Enable the creation of housing for resident individuals and families needing assistance from social and human services providers. In addition to the policies and goals, the Comp Plan lays out several strategies for improving housing affordability: Identify low- and moderate-income housing needs. Streamline permitting procedures based on feedback from businesses and landowners, developers, etc. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 6 Evaluate parking standards and reduce the amount of required parking if feasible. Actions Taken Selected recent actions taken by the City to help address housing affordability are described below. A more detailed list of implemented housing-supportive programs is available in Attachment C. Sales and Use Tax Funds for Affordable and Supportive Housing Purposes In February 2020, the City adopted Ordinance 20-002 to incorporate a sales and use tax for affordable and supportive housing. This ordinance and its subsequent incorporation into the Spokane Valley Municipal Code (SVMC; Section 3.06) authorized the City to receive a rebate of a portion of state sales and use tax collected in the city, in the amount of 0.0073 percent, which can be used only for qualifying expenses related to affordable and supportive housing. This sales tax option is a credit against the state sales tax rate of 6.5 percent, so it will not increase the tax rate for consumers. The City has estimated the annual increase of funds from this program to be approximately $178,000. These funds can be used for acquiring, rehabilitating, constructing, or operating and maintaining new 1 affordable housing units. They cannot be used to fund construction or operation of a homeless shelter, but instead are reserved for longer-term low income, affordable, and supportive housing. The City can use these funds independently, or they can be pooled in partnership with other regional organizations to pay for a larger regional affordable housing development. Funds can be spent on projects each year, or they can be used as a source of repayment of bonds sold to construct an affordable housing capital project. Per state law, cities with populations under 100,000 may use the funds to provide rental assistance to tenants. The city is projected to exceed 100,000 people in approximately three years and is seeking input from the state on whether it may use the funds in this manner once its population exceeds 100,000. Housing Needs Gap, Housing Action Plan The housing needs analysis included an assessment of the gaps between the currently available housing and the housing needed today and into through 2037. The assessment showed that the city has underproduced housing by around 1,463 housing units over the past decade and would need 5,197 new housing units built by 2037 to meet the estimated demand. Not only is there a shortage in the number of housing units available, but the housing needs analysis also showed a mismatch in the type of housing units available. Around 44 percent of all the city households need housing priced below 100 percent of the area median income (AMI), yet this housing is inadequate since only 34 percent of the current housing stock includes housing types affordable for incomes below the AMI, such as less expensive detached single-family homes (ADUs, manufactured homes, cottage), attached single-family homes (duplexes and townhomes and multifamily 1 RCW 82.14.540 Affordable and supportive housing- Sales and use tax. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 7 developments). When examining household income levels, the AMI is a measure helpful for understanding what different households can afford to pay for housing expenses. Figure 3 illustrates the type of home a household may afford based on its income. Examples of housing types can be found in Attachment B. Figure 3: Financially Attainable Housing Types Source: ECONorthwest. Note: All values are in 2019 inflation-adjusted dollars. As a component of the HAP, the housing needs assessment achieves the Comp Plan strategy of identifying low- and moderate-income housing needs. Table 2 shows the quantity of estimated housing units needed between 2020 and 2037 and the breakdown of needed housing based on household income levels. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 8 Table 2: Total Housing Units Needed by AMI through 2037 AMI No. of Units % of Units 0-30%5508% 30-50%6259% 50-80%1,03916% 80-100%68610% 100%+3,76056% Total Units Needed 6,600 Source: ECONorthwest, Spokane Valley Housing Needs Assessment Summary Report, October 2020. Table 3 provides context on home prices ranges and rent affordability thresholds for households in Spokane County. Table 3: Spokane County Housing Affordability Ranges Household Income Level Low End of RangeÐHigh End of RangeÐRent (percent of AMI) Home sale affordability Home sale affordability Affordability 30%$93,000$135,000$805 50%$133,000$196,000$1,006 60%$173,000$247,000$1,207 80%$183,000$272,000$1,274 100%$195,000$285,000$1,305 Source: HUD, 2020, ECONorthwest Calculations. The AMI (100 percent) used for the below analysis is $71,700 annual income for a family of four. This is exclusive of transportation, utility, and other household expenses. Lower-end terms assume a 5 percent down payment, a 4.5 percent interest rate over 30 years, $800 per month for insurance, and 0.5 percent private mortgage insurance. Upper-end terms assume a 20 percent down payment, a 3.5 percent interest rate over 30 years, $800 per month for insurance, and no private mortgage insurance. As the HAP process continues, the project team will work with the City to continue evaluating potential housing types and to identify next steps and priority strategies. The recent building pattern data show that duplexes and multifamily apartments are being built; however, other housing types are being built at a much slower pace (townhomes and ADUs) or not at all (cottages). Interviews with nonprofit and for-profit developers will also help to identify existing barriers to development of affordable housing types and inform the next steps of the HAP. Urban County Consortium The City, along with Spokane County and other municipalities in the region (except for the City of Spokane), is a member of the Urban County Consortium. An interlocal agreement enables the county to manage several state and federal affordable housing and homelessness funding sources, including The U.S. Department of Housing and Urban Development (HUD) HOME program, Community Development Block Grants, and document recording fee revenues generated through the Homeless Housing Assistance Act. These funds are distributed throughout the county to developers and service providers based on a competitive request-for-proposals process. City representatives are members of the advisory board that provides oversight on the use of these funds. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 9 The City is currently evaluating the Primary Subsidy Programs feasibility of assuming control of its The primary programs used to support construction, portion of the document recording fee rehabilitation or acquisition of affordable housing revenues from the Urban County include: HUD Section 202 provides housing for very-low-income Consortium. The primary advantage elderly persons. would be the CityÔs direct oversight of HUD Section 811 provides housing for persons with homelessness funding, enabling better disabilities. communication about how homelessness Low-Income Housing Bond/Tax Credit program in the city is being addressed. provides affordable rental housing for low- and Disadvantages include administrative moderate-income tenants. costs not covered by the Homeless Of the 1,663 subsidized units in the city, 1,010, or 59 Housing Assistance Act program and percent, are funded in part by the bond/tax credit possible duplication of current efforts by program. HUD supports 418 units, or 24 percent, of the the City of Spokane and the county. total units, with remaining units having an unidentified subsidy source. Addressing Homelessness Addressing and preventing homelessness has been a topic of discussion in recent Spokane Valley City Council meetings as the City evaluates its participation in the Urban County Consortium. The Comp Plan currently does not include any goals, policies, or strategies that address homelessness in the city. Creating such Comp Plan goals, policies, and strategies may help to direct City staff working on this issue. Limited availability of property where emergency housing uses are permitted has been a barrier to locating housing for people experiencing homelessness in the Spokane Valley. If the City identifies additional emergency or transitional housing as a priority, it will be important to consider and clearly identify where this type of use will be permitted. Currently, transitional housing is allowed only as a conditional use in the multifamily residential zones. Evaluation of Progress Subsidized Affordable Units An inventory of the CityÔs stock of subsidized, rent-restricted affordable housing was conducted in July 2020. The results are shown in Table 4. As of mid-2020, 1,544 units targeted for households earning less than 80 percent of AMI had been constructed. A 119-unit multifamily development is under construction. When that development is completed, the total count of rent-restricted affordable housing units will increase to 1,663 units. Rent-restricted affordable units account for four percent of the 38,787 total housing units in the city. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 10 Table 4: Spokane Valley Rent-Restricted Housing Units* by Building Age % of Year Built Properties % of Total No. of Low-Income Units Total Pre-20061773.9%1,02661.7% 200614.3%28717.3% 200914.3%372.2% 201414.3%241.4% 201714.3%513.1% 201914.3%1197.2% 2021**14.3%1197.2% Total: 23 100.0% 1,663 100.0% Source: the Washington State Housing Finance Commission, HUDÔs Multifamily Housing Portfolio, the USDA Rural Development Multifamily Housing Program (no properties in Spokane Valley), the Spokane Housing Authority, ECONorthwest. * These data likely capture a robust share of the total rent-restricted affordable housing in the city. ** Construction expected to be complete by mid-2021. The Total Housing Units Needed by AMI through 2037 (Table 2) shows that 2,900 units, or 43 percent of the 6,600 total projected units needed through 2037, are for households earning at or below 100 percent of AMI. Table 5 demonstrates that the city currently has a shortage of rent-restricted units supporting households earning less than 50 percent of AMI, and especially for households earning less than 30 percent of AMI. The target for new units supporting households earning less than 30 percent of AMI by 2037 (shown in Table 2) is 550 units. The city currently has only approximately 60 rent-restricted units in this income bracket. This underscores the challenge faced by the City to encourage an increase in supply for homes attainable for these households through 2037. Table 5: Current Spokane Valley Affordable Housing Units by Income Level Affordability Units with Listed Estimated % of Total Level Rent Data* Total Units** 0-30%404%60 30-50%29226%436 Over 50% 781 70% 1,167 Total:1,113100%1,663 Source: the Washington State Housing Finance Commission, HUDÔs Multifamily Housing Portfolio, the USDA Rural Development Multifamily Housing Program (no properties in Spokane Valley), the Spokane Housing Authority, ECONorthwest * Rent-restricted units with targeted AMI strata identified. ** Extrapolated estimate of the number of rent-restricted units in each affordability level strata. This estimate assumes that the distribution of known units is the same for the unknown portion, to arrive at a total representing the total number of low-income units in the city. Table 5 does not account for naturally occurring affordable housing and includes only units subsidized using state and federal sources. Naturally occurring affordable housingÐdwelling units that are attainable to households at different affordability levels without subsidyÐare not included. Most existing naturally occurring affordable housing units will be in the 50 percent to 80 percent AMI range, which will partially help and which makes a case for preservation. Because affordable housing can be both difficult and expensive to build, strategies to support naturally occurring affordable housing and the preservation of affordable housing should be considered in addition to building new rent-restricted affordable housing. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 11 Market Rate Rental The above tables summarize the status of the subsidized rental housing market in the city and demonstrates that the demand for these units is persistent. Regarding market rate multifamily rental units, Figure 4 shows that the average current asking rental rate for market units that are not subsidized is typically attainable for households earning at least 100 percent of AMI. The exception is for two- bedroom units where households earning 80 percent of AMI can afford the average asking rate. Figure 4: Monthly Rent Payments by HUD Affordability Level Source: HUD, ECONorthwest, CoStar. The current overall vacancy rate for units in multifamily developments is 5.4 percent. This represents a low vacancy rate and demonstrates that the rental market is not overly constrained. A five percent vacancy implies a balance between housing supply and demand. Figure 5: Multifamily Unit Availability Figure 5 shows that two-bedroom units (3,012 units) StudioUnits 321units 3BedUnits and one-bedroom units (1,732 units) are the most 22.1%Available 849units 3.1%Available prevalent multifamily unit type. The current vacancy rate for these unit types is at or near the balanced rate 1BedUnits 1,732units of five percent. These data show that studio units 5.0%Available have a 22.1 percent vacancy rate, representing a lack of demand, and that the three-bedroom units have a 2BedUnits low vacancy rate of 3.1 percent. 3,012units 4.5%Available This market observation is bolstered by a Source: CoStar. demographic finding from the housing needs assessment, which found: ÑBetween 2012 and 2018, the share of 2- and 4-person households grew in Spokane Valley, while the number of 1-person households fell. In contrast, the City of SpokaneÔs share of 1- to 3-person households grew. This trend shows Spokane ValleyÔs housing tilting towards 2-bedroom housing and larger family-friendly housing with at least 2 bedrooms.Ò Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 12 Attached single-family units such as townhomes and detached single-family units such as ADUs available for rent also supplement the rental market. As previously noted, nearly 450 of these types of units have been developed since 2016, and most of these are available for rent. Additional supply of these missing middle housing types is needed to improve housing attainability for all income-level segments, especially for households earning over 60 percent but under 120 percent of AMI. Offering incentives for missing middle housing and modifying the SVMC could assist in filling the gap for these needed housing types. Housing Theme 3: Enhance Distinctive Neighborhood Character/ Support Neighborhood Commercial Comp Plan Policies, Goals, and Strategies The cityÔs current development pattern is primarily auto-oriented, as illustrated by its average Walk Score rating of 30 (indicating that most errands require a car). Comparatively, the City of SpokaneÔs Walk Score is 49, indicating more walkable neighborhoods. Several goals and policies in the Comp Plan encourage neighborhood conveniences and mixed-use residential development. H-G3 Allow convenient access to daily goods and services in Spokane ValleyÔs neighborhoods. LU-P7 Protect residential neighborhoods from incompatible land uses and adverse impacts associated with transportation corridors. These goals and polices may not directly encourage the development of new housing units, but they do support the type of development and neighborhood services that help make communities healthy and vibrant. Actions Taken Retail commercial is permitted in most nonresidential zones but is not allowed in residential zones. Conversely, residential development is permitted in the neighborhood commercial (NC), mixed use (MU), and corridor mixed use (CMU), which support the intent of H-G3. The City established transitional regulations (SVMC 19.75) to protect residents in less intensively zoned areas that abut more intensive zones from development that takes place in those intensive zones. These transitional regulations influence setbacks and building heights. The City also modified its zoning regulations in 2020 to create a new single-family residential urban (R-4) zoning district. This code modification was a response to community input and the CityÔs goal to increase housing options and density in areas near transit and services. The new R-4 zone is concentrated between East Broadway Avenue to the north, North Sullivan Road to the east, East Eighth Avenue to the south, and North Park Road to the west. The R-4 zone creates a buffer zone Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 13 that permits more diverse housing between the R-3 zone and the more intense CMU zone abutting Sprague Avenue. A map of the cityÔs zoning districts can be found in Attachment D. Evaluation of Progress Most of the cityÔs commercial properties are located along the principal arterials and are generally not neighborhood facing. Commercial land uses, including retail and services, are conveniently accessed by automobile, and are located along transit lines, but there are few examples of neighborhood-scaled commercial developments. The city has 16 areas of NC-zoned parcels generally located at key intersections along collector and minor street intersections. Most of these properties are improved with residential units and do not include commercial uses. There are 56 parcels totaling 43 acres zoned NC in the city. Of that total, 26 parcels are vacant or undeveloped and ten parcels have commercial improvements. There are development opportunities for neighborhood commercial uses in the NC zone; however, the market has not responded with new commercial or mixed-use developments since this zone was expanded throughout the city in 2017. Housing Theme 4: Encourage the Creation of Mixed-Use Destinations Comp Plan Policies, Goals, and Strategies The Comp Plan cites the Kendall Yards area of Figure 6: Mixed-Use Examples Spokane as an example of a mixed-use destination Kendall Yards, Spokane development that combines housing, retail, and West of Jefferson Mixed-Use Building, Planned amenities in a walkable community connected to Completion 2021 transit. Another identified example of this type of multi-phased, mixed-use development is the River District in Liberty Lake. The Comp Plan notes that a certain level of residential density is needed to support new businesses in these areas. Multi-phased, mixed-use developments also provide opportunities for mixed-income housing. Source: Inland Northwest Business Watch/Baker Construction. LU-G3 Support the transformation of River District Town Center, Liberty Lake Town center vision with housing above commercial commercial, industrial, and mixed-use areas into accessible districts that attract economic activity. LU-P13 Work collaboratively with landlords and developers that seek to provide mixed- use residential projects. Source: Shoesmith Cox Architects. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 14 LU-P16 Maximize the density of development along major transit corridors and near transit centers and commercial areas. Actions Taken The CityÔs mixed-use zones (MU and CMU) allow for concurrent development of residential and commercial space. These uses may be developed side by side or on top of each other, with the commercial space on the ground floor. Planned residential developments (PRDs) also permit mixed- used developments in residential zoning districts on projects of at least 5 acres. Evaluation of Progress The CMU and MU zones comprise nearly 2,600 acres and 3,116 total housing units, of which 1,899 are multifamily. All these units are in two- or three-story walk-up apartments that do not include commercial uses. Several other areas in the City could support a multi-phased mixed-use development. For example, the Desmet Court multifamily development is under construction on 10 acres in the MU zone located near I-90 and North Sullivan Road. This garden-style apartment project will maximize the allowable density for this zone and result in approximately 300 rental units at a density of 30 units per acre. No commercial space is included in this project. SECTION 2. REGULATORY REVIEW Zoning Regulations The information below summarizes the SVMC Title 19 zoning, and more details on the SVMC can be found in Attachment D. Permitted Uses Table 6 shows the residential uses allowed in the cityÔs residential and nonresidential zones. Residential uses featuring a ÑPÒ in the zoning district column are permitted outright, while those with an ÑSÒ are 2 subject to supplemental code requirements. The City has five residential zones (R-1, R-2, R-3, R-4, and MFR) that are specifically intended to support residential development; however, residential development is also permitted in nonresidential zones. Single-family homes are permitted in all five residential zones, the two mixed-use zones (MU and CMU), and the NC zone. Duplexes are permitted in R-4, MFR, and the two mixed-use zones, while multifamily residential uses are also permitted in the MFR zone and the mixed-use zones. Duplexes are 2 SVMC Chapter 19.40 Alternative Residential Development Options. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 15 also permitted in the R-3 zone under the supplemental use regulations (SVMC 19.40.060) requiring a minimum lot size of 14,500 square feet. Townhouses and cottages are permitted under the supplemental use regulations in the R-4, MFR, MU, and CMU zones. The NC zone also permits townhouses. Table 6: Permitted Uses MatrixÐResidential Uses Nonresidential Zones Residential Zones Residential Use Type Mixed Use Commercial Industrial R-1R-2R-3R-4MFR MU CMU NC RC IMU I Dwelling, accessory S S S S S S S S S units Dwelling, caretakerÔs S S S S S residence Dwelling, cottage S S S S Dwelling, duplex S P P P P Dwelling, industrial S S accessory dwelling unit Dwelling, multifamily P P P Dwelling, single-family P P P P P P P P Dwelling, townhouse S S S S S Manufactured-home S S S park SVMC 19.60.050 Permitted Uses Matrix. P = Permitted. S = Supplemental Use Regulations. Site-Development Standards The City has five residential zoning districts ranging from Single-Family Residential Estate (R-1), the least dense zone that allows for lots of at least 40,000 square feet and one dwelling unit per acre, to MFR, which has no minimum lot size and allows up to 22 dwelling units per acre. No density bonuses are currently allowed, except for PRDs that set aside 30 percent of the development for open space. Table 7 details the dimensional standards for these residential districts. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 16 Table 7: Residential Standards Standard R-1R-2R-3R-4MFR Front and Flanking 35' 15' 15' 15' 15' Street Yard Setback Garage Setback 35' 20' 20' 20' 20' Rear Yard Setback 20' 20' 10' 10' 10' Side Yard Setback 5' 5' 5' 5' 5' Open Space N/A N/A N/A N/A 10% gross area Lot Size 40,000 sq. ft. 10,000 sq. ft. 5,000 sq. ft. 4,300 sq. ft. N/A Lot Coverage 30% 50% 50% 60% 60% Density 1 du/ac 4 du/ac 6 du/ac 10 du/ac 22 du/ac Building Height 35' 35' 35' 35' 50' SVMC 19.70.020 Permitted Uses Matrix. Like the MFR zone, the CMU and MU zones allow for the full range of residential development from single-family residential to multifamily. Residential development in these nonresidential zones must comply with the density and dimensional standards of the MFR zone shown in Table 7. The exception is single-family development in the NC zone, which must comply with the density and dimensional standards of the adjacent single-family residential zone. Transition Regulations PRDs As mentioned earlier in the document, The flexible zoning requirements of PRDs are intended to encourage imaginative design and the creation of the City has transitional regulations that permanent open space and a variety of housing types, apply to properties where a more and to maximize the efficiency in the layout of streets, intensive zoning district abuts a less utility networks, and other public improvements and intensive zone. These code provisions infrastructure. place additional limitations on ground PRDs are allowed in all five residential zones for projects floor uses and regulate setbacks on totaling at least 5 acres. Use and dimensional effected properties. requirements shown in Tables 6 and 7 apply, with some exceptions. Parking Standards For projects of 10 acres or larger, commercial uses that are allowed in the NC zone are also permitted. Off-street parking requirements range A 20 percent residential density bonus can be applied from one stall per unit for ADUs up to in exchange for dedicating 30 percent of the total two stalls per unit for one- and two- project area for open space. family homes and townhomes. The Townhome setbacks may be reduced on one side required parking spaces for residential from 5 feet to 2 feet. uses (SVMC 22.50) can be found in Zero-lot line townhomes are also permitted (SVMC Attachment D. 19.40.100.A). Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 17 Subdivision Regulations Residential subdivisions that require dividing the land into nine or fewer lots may utilize the CityÔs short subdivision process, while those creating ten or more lots are subject to the full subdivision process. Short subdivisions are subject to Type II review procedures, while subdivisions require more stringent Type III review; these reviews are discussed below. Permit Procedures and Environmental review The City has three distinct permit review processes, depending on the size and nature of the proposed project, which are summarized in Table 8, below. Type I is the least intensive review, where permitting decisions are made administratively and notice of application to other agencies and public hearings are not required. Type II review processes are also made administratively. Preapplications are not required, except for short subdivisions and binding site plans, and a notice of public hearing is not required. Type III review processes are decided by a hearing examiner and all review processes are required, including a preapplication conference and a public hearing. Table 8: Required Application Procedures Final Final Pre- Counter-Fully Notice of Application Decision Notice of decision Decision application complete complete public Type Authority application and timeline conference determination determination hearing notice *** The I O X X N/A N/A X 60 days Department The *II**O X X X N/A X 120 days Department Hearing III X X X X X X 120 days examiner X Required, O Optional, N/A Not Applicable. *Does not apply to SEPA threshold determinations. Refer to SVMC 21.20.070(B)(2) for noticing requirements. **Except for short subdivisions and binding site plans, which require a preapplication meeting. ***Timeline after the fully complete determination, fully complete determination is issued within 14 days of receiving the application. SMC 17.80.070. ADUs and residential building permits that do not require State Environmental Policy Act (SEPA) review are subject to Type I review. Projects requiring a SEPA determination and short subdivisions (nine or fewer lots) are subject to Type II reviews. Type III review is reserved for subdivisions (ten or more lots), PRDs, and conditional use permits, which are required for cottage housing and ADUs in industrial zoning districts. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 18 Table 9: Assignment of Development Application Classification (portion) Type Land Use and Development Application Accessory dwelling units Type I Building permits not subject to SEPA Binding site planÐpreliminary and final SEPA threshold determination Type II Short subdivisionÐpreliminary and final Preliminary short subdivision, binding site planÐchange of conditions Conditional use permits (cottage housing, industrial ADUs) Type III Planned residential developments (PRD) SubdivisionsÐpreliminary SMC 17.80.030. SEPA Review The City adopted the maximum allowable SEPA flexible thresholds for residential development in 2016 (SVMC 21.20.040.B). This provides a SEPA review exemption for developments of up to 30 single-family units and 60 multifamily units. This helps to reduce permit processing times and environmental review requirements for projects that fall below these thresholds. In 2016, the City exempted residential and mixed-used infill developments in the following four areas of the city (SVMC 21.20.040.C) from SEPA review: Carnahan Infill Development: Up to 698 new dwelling units. East Sprague Infill Development: Up to 282 new dwelling units. Mirabeau Infill Development: To qualify for an exemption, this area is subject to participation in a voluntary developer agreement based on a Mirabeau traffic study conducted by the City. East Broadway Infill Development: Up to 852 new dwelling units. In addition, developments that meet the criteria established for each area are not required to go through SEPA review, reducing the time required for permitting and environmental analysis in these areas as well. The City is considering ending the SEPA infill requirement of its process as it evaluates adopting transportation impact fees. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 19 SECTION 3. SUMMARY OF FINDINGS Barriers to Development of Existing Housing Types The housing development process is defined in the SVMC and in practice by City staff. There is sufficient development capacity on land in the city to support a range of new housing, and the zoning regulations provide some flexibility for developers to deliver housing at a pace to meet the identified housing needs assessment objective of at least 6,600 housing units by 2037, or around 351 units per year. For reference, between 2010 and 2019 an average of 345 housing units were built per year. The city is primarily a large-lot, single-family community. While residents have voiced appreciation for those characteristics, a survey conducted for this project identified a desire for more housing choices, including townhomes, ADUs, and cottages. Spokane Valley should continue to support robust housing growth and advance strategies in support of housing growth for a diversity of housing types and affordability levels in order to meet its target. Several barriers impact the delivery of housing in general and specific types of housing, and some barriers, such as market acceptance of housing types or the risk of prolonged appeal processes, are beyond the CityÔs control. The following considerations are intended to help the City lower barriers to development. These recommendations will be assessed further in the development of the HAP. Comp Plan Policies and Goals Consider policies that address housing displacement risk by encouraging housing accessibility, equity, and mixed-income housing. Draft a housing policy that emphasizes the CityÔs commitment to address homelessness. Consider a land use policy that incentivizes the development of townhomes and cottages in the R-4 zone. Develop a goal to continue engaging with the cityÔs residents and the development community on the opportunities for and barriers to developing a range of new housing types. Regulatory Further amend the SVMC to support mixed-use housing. Develop incentives for mixed-use projects that include commercial on the ground floor. Ensure that the SVMC is prepared to encourage construction of modular homes for all types of housing. Identify barriers to ADU development and modify the SVMC to incentivize infill development. Chaz Bates, City of Spokane Valley Project No. 1932.01.01 November 4, 2020 Revised January 29, 2021 Page 20 Conduct subarea planning processes, including a Planned Action Environmental Impact Statement. The resulting Planned Action Ordinance would streamline permit processes for needed missing middle residential development types. Affordable Housing Funding and Incentives Outside of the flexibility allowed in its zoning regulations, the City has limited incentives to support the development of a range of housing types that are attainable for a broad variety of household incomes. The following incentives are for the CityÔs consideration and may be studied further as part of the HAP process: Adopt the multifamily property tax exemption incentive promoting mixed-income developments. Evaluate the use of public funds and partnerships to increase construction of affordable housing and mixed-income developments. Examples of public funds include HB 1590 and a voter-approved property tax levy (RCW 84.52.105), both of which support affordable housing creation. Share stormwater charges and permitting fees between the City and developers of low- income housing. Consider waiving the sales tax related to construction materials for projects that provide affordable housing. While not necessarily an incentive, funds from a voter-approved affordable housing levy could be used to support the development of affordable housing. Develop incentives focused on affordable housing preservation to encourage naturally occurring affordable units. ATTACHMENT A COMPREHENSIVE PLAN HOUSING-RELATED GOALS, POLICIES, STRATEGIES, AND PRIORITIES Chapter 2 of the 2017Ï2037 Spokane Valley Comprehensive Plan lists the goals, policies, and strategies that will guide the CityÔs efforts in realizing the communityÔs vision. The Comprehensive Plan notes that: Adopted Vision Statement A community of opportunity where Goals are broad statements of purpose. individuals and families can grow Policies provide specific direction to City staff. and play, and businesses will flourish and prosper. Strategies represent initial, concrete actions to effect implementation. The following captures verbatim the goals, policies, and strategies from Chapter 2 that are relevant to housing. The Community and Economic Development Priorities are included at the conclusion of each Comprehensive Plan Element. HOUSING ELEMENT Goals H-G1 Allow for a broad range of housing opportunities to meet the needs of the community. H-G2 Enable the development of affordable housing for all income levels. H-G3 Allow convenient access to daily goods and services in Spokane ValleyÔs neighborhoods. Policies H-P1 Support voluntary efforts by property owners to rehabilitate and preserve buildings of historic value and unique character. H-P2 Adopt development regulations that expand housing choices by allowing innovative housing types, including tiny homes, accessory dwelling units, prefabricated homes, cohousing, cottage housing, and other housing types. H-P3 Use available financial and regulatory tools to support the development of affordable housing units. H-P4 Enable the creation of housing for resident individuals and families needing assistance from social and human services providers. Strategies Identify low- and moderate-income housing needs. Continue to evaluate new housing typologies to meet market needs. Community and Economic Priorities Encourage the Creation of Mixed-Use Destinations: Regionally, Kendall Yards in Spokane has aroused interest as a relatively new style of development that embraces many of the tenets of a movement called new urbanism. Residents, as well as investors, have indicated interest in this type of development, which could anchor new regional retail, attract overnight visitors, amplify positive publicity, and create new mixed-use housing options. Improve Housing Affordability: Substantial portions of the renter and homeowner population are cost-burdened by rent and mortgage payments. An increase in multifamily housing options would reduce the average rent for these units countywide, improving the livelihood of cost-burdened residents. Furthermore, providing housing options that meet the needs of local employees is critical to ensuring that local companies continue to have access to capable workers. Ensure a Range of Housing Options for Residents: As the cityÔs population ages and the proportion of households with children continues to decrease, the demand for smaller housing options will increase. During conversations with Spokane Valley residents, the desire for new housing typologiesÐincluding cottages and tiny homesÐ arose repeatedly. From an economic development standpoint, these typologies densify existing single-family neighborhoods while enhancing neighborhood character, and therefore provide a captive audience for neighborhood-serving retailers that create new jobs in the community and draw visitors from nearby towns. Enhance Distinctive Neighborhood Character: The Spokane Valley community expressed a strong desire for more neighborhood amenities, such as nonchain restaurants, boutiques, and local entertainment. These commercial features thrive in walkable, high- density residential communities and may best be provided through mixed-use development, where multifamily units can improve the financial feasibility of the development project. ECONOMIC DEVELOPMENT ELEMENT Goals Relevant to Housing ED-G1 Support economic opportunities and employment growth for Spokane Valley. Policies Relevant to Housing ED-P10 Enable the creation and retention of home-based businesses that are consistent with neighborhood character. LAND USE ELEMENT Goals Relevant to Housing LU-G1 Maintain and enhance the character and quality of life in Spokane Valley. LU-G2 Provide for land uses that are essential to Spokane Valley residents, employees, and visitors. LU-G3 Support the transformation of commercial, industrial, and mixed-use areas into accessible districts that attract economic activity. LU-G4 Ensure that land use plans, regulations, review processes, and infrastructure improvements support economic growth and vitality. Policies Relevant to Housing LU-P7 Protect residential neighborhoods from incompatible land uses and adverse impacts associated with transportation corridors. LU-P9 Provide supportive regulation for new and innovative development types on commercial, industrial, and mixed-use land. LU-P13 Work collaboratively with landlords and developers that seek to provide mixed-use residential projects. LU-P14 Enable a variety of housing types. LU-P15 Encourage development in commercial and mixed-use zones by reducing parking requirements. LU-P16 Maximize the density of development along major transit corridors and near transit centers and commercial areas. Strategies Relevant to Housing Streamline permitting procedures based on feedback from business and landowners, developers, etc. Evaluate parking standards and reduce the amount of required parking if feasible. Collaborate with the private sector to ensure the successful redevelopment of vacant land at Mirabeau Point. Community and Economic Priorities Support neighborhood retail. The market trend indicating demand for more retail space is mirrored by the communityÔs desire for an increased number of neighborhood amenities. Spokane Valley residents reported significant demand for walkable retail options in the community, both to enhance the quality of life and to develop distinctive neighborhood identities. Enhance local identity. The community has expressed a desire to develop more unique neighborhood character. This includes encouraging the types of development that support small, independent businesses, including mixed uses and greater density of housing in certain areas. At the same time, the quality of the cityÔs single-family neighborhoods must be preserved. PUBLIC/PRIVATE UTILITIES ELEMENT Goals Relevant to Housing U-G1 Coordinate with utility providers to balance cost-effectiveness with environmental protection, aesthetic impact, public safety, and public health. Policies Relevant to Housing U-P2 Promote the development of citywide communication networks using the most advanced technology available. ATTACHMENT B HOUSING TYPE DEFINITIONS AND EXAMPLES Single-family: A building, manufactured or modular home or portion thereof, designed exclusively for single- family residential purposes, with a separate entrance and facilities for cooking, sleeping, and sanitation. Image Credit: RYN Built Homes Source: Spokane Valley Municipal Code, Appendix A Definitions Duplex: An attached building designed exclusively for occupancy by two families, with separate entrances and individual facilities for cooking, sleeping, and sanitation, but sharing a common or party wall or stacked. Image Credit: Keller Williams Spokane Source: Spokane Valley Municipal Code, Appendix A Definitions Townhouse: A single-family dwelling unit constructed in groups of three or more attached units in which each unit extends from foundation to roof, open on at least two sides. Image Credit: Realtor.com Source: Spokane Valley Municipal Code, Appendix A Definitions Cottage: A small single-family dwelling unit developed as a group of dwelling units clustered around a common area pursuant to SVMC 19.40.050 as now adopted or hereafter amended. Image Credit: The Cottage Company Source: Spokane Valley Municipal Code, Appendix A Definitions Accessory Dwelling Unit: A freestanding detached structure or an attached part of a structure that is subordinate and incidental to the primary dwelling unit located on the same property, providing complete, independent living facilities exclusively for a single housekeeping unit, including permanent provisions for living, sleeping, cooking, and sanitation. Image Credit: Lina Menard Source: Spokane Valley Municipal Code, Appendix A Definitions. Manufactured (mobile) home: A preassembled dwelling unit transportable in one or more sections, which is built on a permanent chassis and is designed for use with or without a permanent foundation when attached to the required utilities certified by the Washington State Department of Labor and Industries. The term Ñmanufactured homeÒ does not include a Ñrecreational vehicle.Ò Image Credit: Keller Williams Spokane Source: Spokane Valley Municipal Code, Appendix A Definitions. Multifamily: A building designed for occupancy by three or more families, with separate entrances and individual facilities for cooking, sleeping, and sanitation. Townhouses are not considered multifamily development. Image Credit: Costar Source: Spokane Valley Municipal Code, Appendix A Definitions. Modular construction: Residences constructed entirely in factories and transported to their sites on flatbed trucks. They are built under controlled conditions and must meet strict quality- control requirements before they are delivered. They arrive as block segments and are neatly assembled, using cranes, into homes that are almost indistinguishable from 1 comparable ones built on site. Image Credit: Timberland Homes 1 Nick Gromicko, Modular vs. Manufactured Homes, National Association of Certified Home Inspectors, accessed 12/23/20, https://www.nachi.org/modular-manufactured-homes.htm. ATTACHMENT C LIST OF ACTIVE HOUSING-SUPPORTIVE PROGRAMS d 3 and ity. vice of s. It nd ety of districts cottage development, meless housing plan. re allowed in a varimillion to homelessness ser uld create a new residential lopment, exempting (RCW) 36.22.179 and RCW living facilities in R-3 district constructing, or operating a lations. This zoning change led to a fill developments in four areas of the c es. Duplexes were permitted in the denser tywide homeless housing programs. Because oviders to apply for funds. In November using. Transactions are taxed at a rate goals of the local ho s to allow for a variety of new housing types accessory dwelling units, for residential deve s served by transit. other housing types we allocate more than $1.3 d Code of Washington dents. As a result, an amendment is proposed, as a part of the ing, townhomes, and assisted- This can limit permit processing times and environmental review 2 dential and mixed-use in ed to go through SEPA review, reducing the time required for s were reviewed and approved by the Housing and Community The new housing included 1 activity in Spokane County support coun ed for homeless services to further the dual lots and in home parks, and townhous al (RFP) process for homelessness service pr e SEPA flexible thresholds standards and use tax for affordable and supportive ho 4 cation, two HHAA funds are administered locallyÐone by Spokane County (the County) an at would prohibit cottage hous which includes three representatives from the City. rges are authorized by two statutes: Revise amily units and 60 multifamily units. e Valley (City) implemented new zoning regulation fall below these thresholds. held an RFP process for its 2020 funding cycle to affordable housing options. able housing units. ronmental analysis. Description In June 2016, the City of Spokantargeting smaller and more duplexes, manufactured homes on both indiviresidential districts (R-3 and Multifamily Residential) and mixed-use districts. The throughout the city, provided they complied with the new supplemental development regusignificant increase in the number of new duplexes being permitted in the city. New duplex development in the city raised some concern among resi2020 comprehensive plan updates, thwould also add supplemental use regulations to duplexes in R-3 zones. The proposed amendment wozone, R-4, that would allow greater density and alternative housing types in areaThe City has adopted the maximum allowabldevelopments of up to 30 single-frequirements for projects thatThe City has implemented an exemption from SEPA review for resiDevelopments that meet the criteria for each area are not requirpermitting and enviIn February 2020, the City adopted a sales 0.0073 percent of the selling price or value. The funds can be used for acquiring, rehabilitating,maintaining new affordHHAA document recording surcha36.22.1971. The recording fee funds must be usCurrently, HHAA recording fees generated fromthe City of Spokane receives a direct alloother by the City of Spokane. The County hosts an HHAA request-for-proposDece mber 2019, the Countyproviders with contracts spanning 18 months. Funding decisionDevelopment Advisory Committee, Accessory dwelling unitsIndustrial accessorydwelling unitsCottage developmentDuplexesManufactured homesTownhouses Program Housing Diversity Alternative Residential Development Options: Streamlined Permitting State Environmental Policy Act (SEPA) ExemptionÐFlexible Thresholds SEPA ExemptionÐInfill Development Housing Sales and Use Tax for Affordable and Supportive Housing Homeless Housing Assistance Act (HHAA) Funds SVMC Chapter 19.40 Alternative Residential Development Options. SVMC Section 21.29.040 Categorical exemptions. Ibid. RCW 82.14.540 Affordable and supportive housing- Sales and use tax. EXISTING HOUSING CODE AND PROGRAMS 1234 in e d nd and , ding on, lley in 2020. Housing This te funds . able housing. In Washingt They also manage Section 8 a competitive RFP to solicit Twelve projects in Spokane Va venue generated from the recor using and Community Development is currently developing a pre- ty investor to provide immedia 6 rrently closed because of high demand a pplications that can be funded each cycle or below 50 percent of the area median pates receiving $1.65 million in CDBG funds a tax credit being assigned to the project. 5 housing projects across the county. for the fund are generated from a document recording housing units in the region. based on their Annual Action Plan and guidance from th are typically offered through the development of new afford https://www.spokanecounty.org/4690/9-LIHTC ty to use 60 percent of the re recommend for funding. remain affordable for 30 years. nance Commission. LIHTC funds can also be used to rehabilitate at allows the Spokane County Ho State LIHTC policies, the County tax obligations or sold to an equi phic pools, which limits the number of a itlist for the housing voucher program is cu ges 846 units of affordable that earn at or below 50 percent of the area median income and that have not pai funds. The County does this atute allows the Coun Housing Trust Fund. Revenues Ò accessed Sept. 17, 2020, ance Program Grant that is intended to prevent evictions by paying past due, current n per funding round to e of housing serving households making at federal funding source for other service providers. The County antici support new and existing affordable t Advisory Committee. The funds ess for LIHTC is extremely competitive, with far more applicants than funding available. The le units created are required to lopments. A successful LIHTC application results in HTC, creating 675 affordable housing units since 2000. . tion Pre-Application process, Description LIHTC is the longest-running and only currentthe program is administered by the Washington State Housing Fiexisting affordable housing devecredit can be either retained by the developer to offset their for the development. The affordabhave taken advantage of LIThe application and selection procFinance Commission allocates funding to geograSpokane County. As a result of recent changes to Washington application process to select one applicatioThe County manages the regionÔs Affordablefee of $10 authorized by RCW 36.22.178. The stfee for building, operation, and maintenancincome. The County uses these funds toSpokane Valley is a member of an Urban County Consortium thDivision to administer federal HOME and CDBGHousing and Community Developmenaffordable housing project proposals from The County manages the Eviction Rent Assistand future rent. The program serves householdsor partially paid one month of rent. The Spokane Housing Authority owns and managrant-based housing voucher programs. The walimited funding. https://lihtc.huduser.gov Program Low Income Housing Tax Credits (LIHTC) Affordable Housing Trust Fund Federal HOME funds and Community Development Block Grants (CDBG) Eviction Rent Assistance Program Subsidized Housing and Housing Voucher program HUD, ÑLIHTC Database,Ò 2018, Spokane County, Ñ2021 9% LIHTC Metro-Pool Prioritiza 56 ATTACHMENT D ZONING CODE REFERENCE CITY OF SPOKANE VALLEY ZONING DISTRICTS Comprehensive Plan Land Use Designation Zoning District Code Zoning District Single-Family Residential R-1Single-Family Residential Estate Single-Family Residential R-2Single-Family Residential Suburban Single-Family Residential R-3Single-Family Residential Single-Family Residential R-4Single-Family Residential Urban Multifamily Residential MFR Multifamily Residential Mixed Use MU Mixed Use Corridor Mixed Use CMU Corridor Mixed Use Neighborhood Commercial NC Neighborhood Commercial Regional Commercial RC Regional Commercial Industrial I Industrial Industrial Mixed Use IMU Industrial Mixed Use SVMC 19.20.010 Zoning districts RESIDENTIAL PERMITTED USE TABLE Residential Mixed-Use Commercial Industrial R-1R-2R-3R-4MFR MU CMU NC RC IMU I Residential Dwelling, accessory S S S S S S S S S units Dwelling, caretakerÔs S S S S S residence Dwelling, cottage S S S S Dwelling, duplex S P P P P Dwelling, industrial S S accessory dwelling unit Dwelling, multifamily P P P Dwelling, single-family P P P P P P P P Dwelling, townhouse S S S S S Manufactured home S S S park SVMC 19.60.050 Permitted Uses Matrix P= Permitted. S= Supplemental Use Regulations. RESIDENTIAL STANDARDS TABLE (1) R-1R-2R-3R-4MFR Front and Flanking 35' 15' 15' 15' 15' Street Yard Setback (2) Garage Setback 35' 20' 20' 20' 20' Rear Yard Setback 20' 20' 10' 10' 10' Side Yard Setback 5' 5' 5' 5' 5' Minimum 10% gross Open Space N/A N/A N/A N/A (3) area (6)(4) Lot Size 40,000 sq. ft. 10,000 sq. ft. 5,000 sq. ft. 4,300 sq. ft. N/A Lot Coverage 30% 50% 50% 60% 60% Density 1 du/ac 4 du/ac 6 du/ac 10 du/ac 22 du/ac Maximum (5) Building Height 35' 35' 35' 35' 50' -1 Where MFR abuts R-1, R-2, or R-3 zones, development shall comply with the provisions of Chapter 19.75 SVMC, Transitional Regulations. (hyperlink to existing code) -2 Attached garages, where the garage door does not face the street, may have the same setback as the primary structure. -3 Open-space requirement does not apply to single-family development in the MFR zone. -4 Single-family residential development in the MFR zone shall have a minimum lot size of 2,000 square feet per dwelling unit. Only one single-family dwelling shall be allowed per lot. -5 The vertical distance from the average finished grade to the average height of the highest roof surface. -6 Duplex development in R-3 zone shall have a minimum lot size of 14,500 square feet. SVMC 19.70.020 Permitted uses matrix SUPPLEMENTAL STANDARDS FOR ALTERNATIVE RESIDENTIAL DEVELOPMENT OPTIONS Accessory Dwelling Units (ADUs) Definition: a freestanding detached structure or an attached part of a structure that is subordinate and incidental to the primary dwelling unit located on the same property, providing complete, independent living facilities exclusively for a single housekeeping unit, including permanent provisions for living, sleeping, cooking, and sanitation. See ÑResidential, use category.Ò Site One ADU is allowed per lot. One off-street parking space is required. Building Must be similar in appearance to single-family home in finish, roof pitch, trim, and windows. The entrance should be located on the side or rear of the unit. Must be at least 300 square feet. Cannot exceed 50 percent of the habitable square footage of the primary unit. Footprint cannot exceed 10 percent of the lot area or 1,000 square feet, whichever is greater. Cannot have more than two bedrooms. Other Located behind the front building setback line and placed on a permanent foundation. Preserve all side yard and rear yard setbacks for a dwelling unit. Not allowed on lots containing a duplex, multifamily dwelling, or accessory apartment. The owner must occupy either the primary dwelling unit or the ADU as their permanent residence for six months or more of the calendar year and at no time receive rent for the owner-occupied unit. A deed restriction shall be recorded with the Spokane County auditor to indicate the presence of an ADU, the requirement of owner occupancy, and other standards for maintaining the unit as described in the Spokane Valley Municipal Code (SVMC). Industrial ADUs Definition: A dwelling unit within a primary building located in the industrial zone for occupancy by a person or family for living and sleeping purposes. Site An industrial ADU may be developed in conjunction with either an existing or new building. The maximum number of allowed industrial ADUs is ten per site. One off-street parking space for each ADU is required in addition to the off-street parking required for the primary use. Building The ADU, excluding any garage area, is prohibited on the first floor of the building. The ADU unit shall not have more than two bedrooms. Permit Type Industrial accessory dwelling units shall require approval of a conditional use permit pursuant to Chapter 19.150 SVMC. Cottage development Definition: A small single-family dwelling unit developed as a group of dwelling units clustered around a common area pursuant to SVMC 19.40.050 as now adopted or hereafter amended. Site The design of a cottage development shall take into account the relationship of the site to the surrounding areas. The perimeter of the site shall be designed to minimize adverse impact of the cottage development on adjacent properties and, conversely, to minimize adverse impact of adjacent land use and development characteristics on the cottage development. The maximum density shall be two times the maximum number of dwelling units allowed in the underlying zone. Where feasible, each cottage that abuts a common open space shall have a primary entry and/or covered porch oriented to the common open space. Buildings shall meet the following minimum setback standards: Twenty-two-foot front yard setback. Ten-foot rear yard setback. Five-foot side yard setback. Common open space is required and shall meet the following criteria: Four hundred square feet of common open space per cottage. Setbacks and private open space shall not be counted toward the common open space. One common open space shall be located centrally to the project, with pathways connecting the common open space to the cottages and any shared garage building and community building. Cottages shall surround the common open space on a minimum of two sides of the open space. Community buildings may be counted toward the common open space requirement. One and one-half off-street parking spaces for each cottage are required. Building Cottages shall not exceed 900 square feet, excluding any loft or partial second story and porches. A cottage may include an attached garage, not to exceed an additional 300 square feet. The building height for a cottage shall not exceed 25 feet. The building height for any attached garage or shared garage building shall not exceed 20 feet. Buildings shall be varied in height, size, proportionality, orientation, rooflines, doors, windows, and building materials. Porches shall be required. Other ADUs are prohibited. All other SVMC provisions that are applicable to a single-family dwelling unit shall be met. SVMC Title 20, Subdivision Regulations. The design requirements of SVMC 20.20.090 are waived. Permit Type Cottage development shall require approval of a conditional use permit pursuant to Chapter 19.150 SVMC. Community buildings Community buildings are encouraged in cottage developments. Community buildings shall meet the following criteria: They shall be clearly incidental in use and shall not exceed 1,000 square feet. They shall be no more than 20 feet in height. They shall be commonly owned and maintained by the property owners. Duplexes Definition: An attached building designed exclusively for occupancy by two families, with separate entrances and individual facilities for cooking, sleeping, and sanitation, but sharing a common or party wall or stacked. See ÑResidential, use category.Ò Duplex development in the R-3 zone shall have a minimum lot size of 14,500 square feet. Duplex development in nonresidential zones shall meet the requirements set forth in SVMC 19.70.050(G). Manufactured homes on individual lots Definition: A preassembled dwelling unit transportable in one or more sections, which is built on a permanent chassis and is designed for use with or without a permanent foundation when attached to the required utilities certified by the Washington State Department of Labor and Industries. The term Ñmanufactured homeÒ does not include a Ñrecreational vehicle.Ò Homes built to 42 U.S.C. 70 Sections 5401 through 5403 standards (as they may be amended) are regulated for the purposes of siting in the same manner as site-built homes, factory-built homes, or homes built to any other state construction or local design standard, provided that the manufactured home shall: Be set upon a permanent foundation, as specified by the manufacturer, and that the space from the bottom of the home to the ground be enclosed by concrete or an approved product that can be either load-bearing or decorative. Comply with all local design standards, including the requirement for a pitched roof with a slope of not less than 3:12, applicable to all other homes in the neighborhood in which the manufactured home is to be located. Be thermally equivalent to the State Energy Code. Otherwise meet all other requirements for a designated manufactured home as defined in RCW 35.63.160. SVMC 19.40.070 does not override any legally recorded covenants or deed restrictions of record. An existing single-wide manufactured home may be replaced with a new single-wide manufactured home when replacement is initiated within 12 months of the date of damage representing less than 80 percent of market value, or removal of the existing habitable manufactured home. Manufactured homes with dimensional features that match or closely match the predominant manufactured home type within a manufactured home subdivision may be placed in the manufactured home subdivision without regard to the age of the manufactured home (Ord. 16-018 § 6 (Att. B), 2016). Manufactured home parks Definition: A site having as its primary use the rental of space for occupancy by two or more manufactured (mobile) homes, and the accessory buildings, structures, and uses customarily incidental to such homes. See ÑResidential, use category.Ò Manufactured home parks shall require approval of a binding site plan and site plan review pursuant to SVMC Title 20, Subdivision Regulations, and Chapter 19.130 SVMC, Site Plan Review. Manufactured home park density shall be consistent with the zoning classification in which they are located, not to exceed 12 units per acre. A minimum of five manufactured-home spaces shall be required per park. Manufactured home parks shall provide at least 10 percent of the gross area of the park for common open space for the use of its residents. Each manufactured home space shall have direct frontage on a public or private street. The minimum setbacks shall be pursuant to Table 19.40-1. Minimum setback from the Minimum setback from the property lines of individual in boundary of the manufactured park spaces home park Front Side Rear Side Rear Right-of- Yard Yard Yard Yard Yard Way Manufactured homes 5Ô 5Ô 5Ô 10Ô 10Ô 20Ô Patio covers, decks, landings, 5Ô 5Ô 5Ô 5Ô 5Ô 20Ô awnings Carports 5Ô 5Ô 5Ô 5Ô 5Ô 20Ô Townhouses Definition: A single-family dwelling unit constructed in groups of three or more attached units in which each unit extends from foundation to roof, open on at least two sides. See ÑResidential, use category.Ò In zero lot line developments approved as part of a planned residential development, zero setbacks along one side are allowed, provided a 2-foot maintenance easement is recorded as part of the subdivision plan. Townhouses located on individual lots shall meet minimum rear, front, and side yard requirements (where applicable), minimum area requirements, maximum lot coverage, and building height requirements shown in Table 19.70-1. Townhouses are subject to the following requirements: No more than six dwelling units shall be attached in one continuous row or group. A townhouse unit shall not be constructed above another townhouse unit. There shall be a side yard on each side of a contiguous row or group of dwellings of not less than 6 feet. Townhouses included in a condominium development may limit the lot to the building footprint, provided that the yard area shared in common with all units is equivalent in area to the yard required by the underlying zone (Ord. 16-018 § 6 (Att. B), 2016). Homeowner or property owner association required In a cottage development or manufactured home park, a property ownersÔ or homeownersÔ association shall be established for the purpose of ownership, maintenance, and management of open spaces, common areas, buildings, and private streets as required by the provisions of the SVMC (Ord. 16-018 §6 (Att. B), 2016). PERMIT PROCESSES Permit Type and Land Use Application Final Final Pre-Counter-Fully Notice of Application Decision Notice of decision Decision application complete complete public Type Authority application and timeline conference determination determination hearing notice *** The I O X X N/A N/A X 60 days department The II* O** X X X N/A X 120 days department Hearing III X X X X X X 120 days examiner X Required O Optional N/A Not Applicable *Does not apply to SEPA threshold determinations. Refer to SVMC 21.20.070(B)(2) for noticing requirements. **Except for short subdivisions and binding site plans, which require a preapplication meeting. ***Timeline after the fully complete determination; fully complete determination is issued within 14 days of receiving the application. Accessory dwelling units 19.40 Type I Building permits not subject to SEPA 21.20.040 Floodplain development 21.30 Binding site planÐpreliminary and final 20.50 Binding site planÐchange of conditions 20.50 SEPA threshold determination 21.20.060 Shoreline conditional use permit 21.50 Type II Shoreline nonconforming use or structure review 21.50 Shoreline substantial development permit 21.50 Shoreline variance 21.50 Short subdivisionÐpreliminary and final 20.30, 20.40 Preliminary short subdivision, binding site planÐchange of conditions 20.30 Conditional use permits 19.150 Type III Planned residential developments 19.50 SubdivisionsÐpreliminary 20.30 REQUIRED PARKING SPACES Table 22.50-1ÐRequired Parking Spaces for Specific Uses Use Required Parking Residential Dwelling, accessory units 1 per dwelling unit Dwelling, multifamily, studio, and one bedroom 1 per dwelling unit, plus 5% of total for guests Dwelling, multifamily, two or more bedrooms 1.5 per dwelling unit, plus 5% of total for guests Dwelling, one- and two-family, townhouse 2 per dwelling unit Manufactured (mobile) home park 2 per dwelling unit plus 5% total for guest parking Group Living Assisted living facility/convalescent/nursing home 1 per 4 residents plus 1 per staff on largest shift Community residential facility 1 per 4 residents Dwelling, congregate 1 per sleeping room https://www.codepublishing.com/WA/SpokaneValley/#!/SpokaneValley22/SpokaneValley2250.html#22.50 UBC$: APPENDIX D SUMMARY OF COMMUNITY ENGAGEMENT MEMORANDUM To:Chaz Bates Date: March 4, 2021 From: Kate Elliott Project No.: 1932.01.01 Matt Hoffman RE: City of Spokane Valley Housing Action Plan Public Engagement Summary SUMMARY OF PUBLIC ENGAGEMENT Maul Foster & Alongi, Inc. (MFA) led a public engagement process to gather stakeholder input to inform the Housing Action Plan (HAP) as it was developed. These efforts engaged key stakeholders including community members, workers, businesses, nonprofit organizations, service providers, housing developers and housing managers, and others to understand their priorities related to housing in the City of Spokane Valley(City). Their priorities were foundational in developing the HAP. The Community Engagement Plan (CEP) for the City of Spokane Valley’s HAP was developed in accordance with the Washington State Department of Commerce’s Guidance for Developing a Housing Action Plan (Public Review Draft). The summary below outlines the findings from the community engagement efforts which included an online survey and stakeholder interviews. Project updates were provided to our key stakeholders and the general public using email and listserv updates, media updates and media interviews, and an article in the city magazine which is mailed to every address in the city. The purpose of the project updates was to ensure the community was aware of project status, milestones, upcoming engagement opportunities, and ways to get involved and provide input. COMMUNITY ENGAGEMENT APPROACH The CEP details the goals, approach, and methodology that were conducted for this project. The final CEP is included in Attachment A of this summary. The engagement effort was developed around the goal of understanding the community’s housing priorities including opportunities and challenges. The plan focused on providing background information necessary for the public to understand the purpose, need, and value of a HAP and the importance of providing diverse, affordable housing to support inclusive neighborhoods. Chaz Bates Project No. 1932.01.01 March 4, 2021 Page 2 Community input was used to shape the direction of the HAP’s strategies and recommendations. Draft strategies and recommendations were then reviewed by staff and theCity Council, and the final HAP, once prepared, will be distributed to the public for further comment and refined based on feedback prior to adoption. A list of the outreach tactics used in development of the HAPis summarized in the table. Table: List of Outreach Tactics Month Outreach Tactics Summer 2020 Community engagement plan Project web page, materials, and “on-hold” message for the City of Spokane Valley general phone line Stakeholder interviews Community and partner update describing the HAP purpose, need, and process Fall 2020 Community survey #1 about the current state of housing and housing needs (Survey was live 9/21–10/19) Website updates regarding project status Winter 2020–21 City magazine article about the HAP (quarterly magazine mailed to all addresses in November 2020) Council/Commission check-ins with opportunity for public input Website updates regarding project status Community and partner update on project status COMMUNITY ENGAGEMENT FINDINGS In September and October 2020, MFA conducted an online public survey and stakeholder interviews. The survey garnered 124 responses. Following the survey, MFA conducted stakeholder interviews with 15 housing-related professionals involved in the development of housing, management of housing, and programs that support housing ownership and affordable housing. The interviews helped expand on the themes identified from the survey responses to help build out the context for the community’s priorities around housing. SURVEY FINDINGS The following sections summarize the responses and sentiment in the community survey. The survey was fielded using SurveyMonkey from September21 to October 19, 2020 and received 124 responses. The Spokane Valley community was well represented, and demographics of those that took the survey aligned closely to the overall makeup of the city. Survey demographics can be found in Figures 1 through 3 in Attachment B of this summary. COVID-19 impacts to housing At the time of the survey, 13 percent of responses noted impacts to their housing situation due to the COVID-19 pandemic, and an additional five percent said they expect to be impactedin the future. C:\\Users\\cbates\\AppData\\Local\\Microsoft\\Windows\\INetCache\\Content.Outlook\\HBQ0H6P9\\Community Engagement Summary Memo.docx Chaz Bates Project No. 1932.01.01 March 4, 2021 Page 3 Respondents noted a number of reasons they were unable to keep up with rent or housing payments including losing jobs, changes in income, and businesses shutting down. The figure summarizes this input. Figure: Impacts of COVID-19 Owners and renters in Spokane Valley The survey asked whether the respondents owned or rented their homes. All respondents answered this question and 75 percent were owners—56 percent owned with a mortgageand 19 percent owned free and clear. Renters accounted for 23 percent of the responses. The other three respondents either occupied their unit without payment of rent or they did not have stable housing. Barriers to renting in Spokane Valley Only 25 of the 124 respondents (20 percent) identified as renters. This question allowed respondents to select more than one choice. The 25 respondents provided a total of 31 responses. Of these 31 responses, 77 percent said finding affordable housing in the city was a barrier to renting. Challenges included not being able to find affordable housing (61 percent identified this as a barrier), 10 percent identified as a barrier not being able to find housing that accepted housing vouchers, and six percent said past evictions, or no ADA-available units was a barrier. The remaining 23 percent of renters did not experience any barriers to renting. Figure 4 of Attachment B includes a summary of this data and further demographic information. Barriers to purchasing a home in Spokane Valley This question asked if respondents had recently tried to buy or bought a home and allowed respondents to select more than one answer. The 102 responses include renters and homeowners. Of C:\\Users\\cbates\\AppData\\Local\\Microsoft\\Windows\\INetCache\\Content.Outlook\\HBQ0H6P9\\Community Engagement Summary Memo.docx Chaz Bates Project No. 1932.01.01 March 4, 2021 Page 4 this total, 23 percent said affordability was a barrier, and 18 percent could not afford a down payment. Others noted difficulty finding the right type of housing, being outbid, or not finding a place in the location they wanted. Less than half of the respondents did not encounter any barriers (45 percent, or 29 of 64). Figure 5 of Attachment B includes a summary of this data and further demographics. Types of housing in Spokane Valley Of the 124 respondents, 109 indicated the type of housing that they currently live in. Single-family homes accounted for 80 percent of where respondents live, while the next most common housing type was multifamily homes at 13 percent. Figure 6 of Attachment B includes a summary of this data and further demographics. Favored housing types for Spokane Valley Respondents were also asked what type of housing they would like to live in. Of the 124 respondents 107 provided at least one answer. Respondents could select more than one housing type and a total of 159 housing types were selected. Single-family homes were the most desired housing type at 60 percent of responses, though nearly all the respondents (90 percent) included single-family homes as one of their choices. The next most favored were: Cottages: 16 percent of the total responses with 24 percent of the respondents selecting this choice. Townhomes: Nine percent of the responses with 13 percent of the respondents selecting this choice. Duplex: Seven percent of the responses with 10 percent of the respondents selecting this choice. Figure 7 of Attachment B includes a summary of the 159 responses and further demographics. Housing options with the greatest need Respondents were asked what kind of housing options are in greatest need in Spokane Valley. Of the 124 respondents, 93 provided at least one answer. Respondents could select more than one type of housing and a total of 206 responses were provided. Of the 93 respondents, 73 percent felt more affordable ownership housing options were the greatest need. The other two most frequently selected needs were the desire for more affordable housing for seniors, with 48 percent selecting this choice, and the desire for more flexibility for single-family homeowners to build accessory dwelling units, such as backyard cottages, with 44 percent selecting this choice. Figure 8 of Attachment B includes a summary of the 206 responses and further demographics. C:\\Users\\cbates\\AppData\\Local\\Microsoft\\Windows\\INetCache\\Content.Outlook\\HBQ0H6P9\\Community Engagement Summary Memo.docx Chaz Bates Project No. 1932.01.01 March 4, 2021 Page 5 Open-ended questions Impacts to the quality of living in Spokane Valley When asked about issues or challenges that impacted their quality of life, responses ranged from lack of affordable housing to pesky neighbors. Respondents noted that higher drug, crime, and homelessness areas are often also lower income housing areas. The desire for recreation and parks was mentioned several times. A list of quotes from this open-ended question can be found after Figure 8 of Attachment B. Ways the City can improve housing When asked about how Spokane Valley can improve housing for the community most respondents noted either a need for encouraging the development of more affordable housing and promoting more housing choices. A list of quotes from this open-ended question can be found after Figure 8 of Attachment B. Primary reason for living in Spokane Valley The final question asked respondents why they lived in the Spokane Valley. Many respondents were either born and raised or work in the area. Responses indicated that apart from train traffic, the Spokane Valley is a quiet community with less vehicle traffic and fewer challenges associated with bigger cities. Good schools and great quality of life were noted many times, as well as ease of access to Interstate 90. A list of quotes from this open-ended question can be found after Figure 8 of Attachment B. STAKEHOLDER INTERVIEWS The stakeholder interviews generated a wealth of information, and the content of each interview was analyzed to identify similar and distinct key themes and insights, all of which informed the HAP. The 15 interviewees, listed below, included housing developers, nonprofit service providers and developers, and housing advocates. Their experiences provided insights into housing challenges and opportunities specific to Spokane Valley and directly informed the development of the housing polices. 1.Dennis Crapo, Diamond Rock Construction 2.Lanzce Douglas, Douglas Properties 3.Deb Elzinga, Community Frameworks 4.Jim Frank, Greenstone 5.Michelle Girardot, Habitat for Humanity 6.Rob Higgins, Spokane Association of REALTORS 7.Julie Honekamp, SNAP 8.Ray Kimball, Whipple Engineering 9.Jonathan Mallahan, Catholic Charities 10.Jennyfer Mesa, Latinos en Spokane C:\\Users\\cbates\\AppData\\Local\\Microsoft\\Windows\\INetCache\\Content.Outlook\\HBQ0H6P9\\Community Engagement Summary Memo.docx Chaz Bates Project No. 1932.01.01 March 4, 2021 Page 6 11.Dave Roberts, Spokane Housing Ventures 12.Ben Stuckart, Spokane Low Income Housing Consortium 13.Todd Walton, Inland Group 14.Darin Watkins, Spokane Association of REALTORS 15.Joel White, Spokane Home Builders Association Summary of Findings Development process Input from the developers interviewed was that development process in Spokane Valley is working efficiently for permitting and constructing new single-family and multifamily housing. Interviewees indicated positive experiences working with building officials and Spokane Valley staff navigating the permit process. The fee schedules are in line with the market. However, those involved with developing affordable housing noted there would be an added benefit to an otherwise challenging development pro forma if the city reducedor waived fees for affordable housing projects. Competitive and limited affordable housing funding sources Federal, state, and local funds for affordable housing are limited and highly competitive and there is limited funding available for distribution to projects annually. There are only two qualified census tracts in the city, 117.02 and 118.00. Affordable housing developments in qualified census tracts that apply for low-income housing tax credit funding receive a boost in the amount of tax credits they can receive. These tax credits are important for making regulated affordable housing projects feasible. Opportunities to encourage housing development Several interviewees noted that there is very limited inventory for starter homes, and the gap in missing middle housing in Spokane Valley is real. A range of ideas were offered based on the interviewees’ professional experience and their conversations with the community. The following bullets summarize the ideas: Low-Income Households Rent deposits and documentation requirements can be hurdles for portions of the population. Consider programs or policies that address this hurdle. Down payment assistance for first time home buyers. Acknowledge equity and race in the comprehensive plan to position the city to address housing equity. Consider a city compliance office to collect and address compliance incidents. Limited equity co-ops are a means to create wealth and home ownership for long-term tenants. Challenges include patient investors and gap financing. The other model often noted is shared equity. These programs do not require city intervention. The city may C:\\Users\\cbates\\AppData\\Local\\Microsoft\\Windows\\INetCache\\Content.Outlook\\HBQ0H6P9\\Community Engagement Summary Memo.docx Chaz Bates Project No. 1932.01.01 March 4, 2021 Page 7 provide resources and information, and/or provide financial support for limited equity co-ops if it creates a housing fund. Programs and Incentives Provide housing around state and federally supported transportation investments. Planned Action Environmental Impact Statements may provide additional incentives for developing housing in these areas by reducing the project-level permitting process. Several interviewees noted the potential benefits of implementing a multifamily tax exemption program. Create a Planned Residential Development track for smaller lots (less than five acres) that provide affordable housing and/or missing middle housing types. Offer nonprofits the first right of refusal to develop affordable housing units on city- owned properties or properties with a lien. Brownfields may provide land opportunities not sought by market-rate developers. Outreach and Partnerships A regional communications campaign dispelling housing myths and showing the positive benefits of healthy homes. Partner with neighborhood groups or support the creation of one that is focused on Spokane Valley. SNAP (Spokane Neighborhood Action Partners) is a model. Seek partnerships with private entities seeking philanthropic endeavors. A local example is a project in northeast Spokane that was built by Spokane Housing Ventures in partnership with Empire Health Foundation. Traditional affordable housing funding sources were used as was support from the foundation. Threats to housing development and preservation of affordable units Several interviewees mentioned threats to housing development and the need to preserve affordable units. A range of ideas were offered based on the interviewees’ professional experience and their many conversations with the community. The following bullets summarize the ideas: Lumber prices have gone up by more than 120 percent over the past year. There is not anything the city can do about this, but these increased costs directly impact housing prices. Labor shortages impact development costs. It was noted that encouraging more trade jobs through apprenticeship programs or partnerships could help grow the workforce that may reduce labor availability and related development cost impacts. Vintage affordable housing units that need rehabilitation could be an area of focus. The rehabilitation costs require debt, and the financial package may require higher incomes. C:\\Users\\cbates\\AppData\\Local\\Microsoft\\Windows\\INetCache\\Content.Outlook\\HBQ0H6P9\\Community Engagement Summary Memo.docx Chaz Bates Project No. 1932.01.01 March 4, 2021 Page 8 The unintended consequence is a loss of units that serve the 30 percent or less AMI households. One developer shared about a single-family subdivision that was subject to public comment and SEPA review being held up because of protest from nearby residents despite complying with local code. External forces driving developers from Spokane County Developers that have been active in Spokane County indicated that they are seeking development opportunities in northern Idaho where the housing market is similar but wherethere is significantly less state regulation. Interviewees noted the diminishing availability of large tracks of unimproved land in Washington and the increasing cost of land relative to Idaho as driving forces. There was a strong desire to expand the Urban Growth Boundary to provide more land to develop housing. Several interviewees cited that the energy code revisions adopted by Washington will add costs to home development. These measures, which take effect in 2021, increase development costs which are passed through to the home buyer. Finally, Washington state’s condominium laws create a disincentive to develop this type of attainable housing due to insurance requirements. Condominium law reform is needed to encourage development of higher density condominium buildings that may offer affordable home ownership options. PRE HAP-ADOPTION OUTREACH Community input was used to shape the direction of the HAP’s strategies and recommendations. Draft strategies and recommendations were then reviewed by staff and the City Council, and the final HAP, once prepared, will be posted on the HAP project web page (https://www.spokanevalley.org/HAP), distributed to the public for further comment, and refined based on feedback prior to adoption. C:\\Users\\cbates\\AppData\\Local\\Microsoft\\Windows\\INetCache\\Content.Outlook\\HBQ0H6P9\\Community Engagement Summary Memo.docx ATTACHMENT A COMMUNITY ENGAGEMENT PLAN City of Spokane Valley Housing Action Plan Community Engagement Plan Background In 2019, the Washington State Legislature passed Engrossed Second Substitute House Bill 1923 (E2SHB 1923) encouraging all cities planning under the Growth Management Act to adopt actions to increase residential building capacity. Of the options provided by E2SHB 1923, the city opted to complete a housing action plan. The Washington State Department of Commerce (Commerce) provided grant funding for the development of a housing action plan. Source: City of Spokane Valley (City) RFP. The goal of a housing action plan is to encourage construction of additional affordable and market rate housing in a greater variety of housing types and at prices that are accessible to a greater variety of incomes. To do this the City will quantify existing and projected housing needs for all income levels, develop strategies to increase the supply of housing while minimizing displacement of low-income residents. Source: E2SHB 1923. An important part of the Housing Action Plan (HAP) is gathering input from the community and key stakeholders. This community engagement plan (CEP) outlines the goals, key messages, tactics, and an implementation schedule for the City to effectively engage its audiences for the purposes of developing its HAP. The community views City efforts positively. Like many Washingtonians, the Spokane Valley community would benefit from additional information about the current housing situation and the background on why the state passed E2SHB 1923. The Housing Action Plan CEP is designed to engage with stakeholders and solicit their input and engage with the broader community to gather feedback and increase awareness of housing needs and opportunities in the community. Due to the rapidly changing COVID-19 situation, this plan uses web-based technologies, online tools, and virtual meetings. This CEP for the City’s HAP was developed in accordance with Commerce’s Guidance for Developing a Housing Action Plan (Public Review Draft). Outreach and engagement goals Integrate with City staff in the HAP planning process Foster a two-way dialogue with stakeholders and community members Allow stakeholders and the broader community to feel heard, informed, involved, and invested in Build trust between the City and the community throughout the engagement process Key messages In 2019, the Washington State Legislature passed a bill (E2SHB 1923) encouraging cities to adopt actions to increase residential building capacity. The goal of this HAP is to encourage construction of a greater variety of housing types at prices that are accessible to a greater variety of incomes. When complete, the HAP will include information on the existing housing stock in the City, projected housing needs for all income levels, and strategies to FINAL 7/15/2020 1 increase the supply of housing while minimizing displacement of low-income residents. The development of the HAP is funded by a grant from Commerce. Key milestones Q2 April–June 2020 Project initiation Deliverable 1 Community Engagement Plan 6/30/2020 Q3 July–September 2020 Stakeholder interviews Community survey #1 Deliverable 2 Housing Needs Assessment Report 7/30/2020 Council/Commission check-in #1 Q4 October–December 2020 City magazine article due Oct. 15 Community survey #2 Greater Spokane Valley Chamber of Commerce informational meeting Council/Commission check-in #2 Deliverable 3 Recommended policy and code changes 12/31/2020 Deliverable 4 Housing Strategies report 12/31/2020 Deliverable 5 Implementation Plan 12/31/2020 Q1 January–March 2021 Deliverable 6 Housing Action Plan 2/01/2021 Council/Commission final presentation Q2 April–June 2021 Deliverable 7 Adopted Housing Action Plan 5/31/2021 FINAL 7/15/2020 2 Audiences, goals, and tactics Audience GoalsTactics Citystaff Involved and invested in theSurveys plan and its outcomes Interviews Extend engagement City Council briefings opportunities for staff participation CityCouncil and Informed on project purpose,City Council briefings Planning goals, and timeline Interviews Commission Opportunities to communicate Surveys with the public through Email updates engagement activities Early understanding of public perceptions Cityresidents, Allow stakeholders and theCity Council briefings homeowners, and broader community to feel Interviews landowners heard, informed, involved, and Surveys invested Email updates Build trust between the City and Project web page the community throughout the Media outreach engagement process City magazine article “On-hold” message Chamber event Social media posts Partners (e.g. County, Involved and invested in theInterviews community resource plan and its outcomes Surveys groups, housing Aware of opportunities to Email updates developers andother provide feedback and share Project web page housing-related partners, information Chamber event Spokane Homebuilders) Local and regional media Kept consistently updatedMedia outreach throughout process City Council briefings Informed about the Housing Action Plan purpose, goals, and timeline Know the city is listening and wants to engage with its community View the HAP as an important piece of the local planning and development Engagement tools The following tools are recommended for the City to educate and engage with the community throughout the HAP development. The format or list may change in response to COVID-19. FINAL 7/15/2020 3 Project materials Display or presentation materials (e.g. PowerPoint) Informational fact sheet in translated languages Materials posted on the City’s web page News releases for local newspapers at key milestones (local media covers city news with weekly and monthly papers and a weekly podcast) City magazine (published twice annually, mailed to all 50,000 households) •Oct. 15, 2020 content deadline for November publication; notify Jeff of page requirements, use ECONorthwest graphics “On-hold” messages play when people call the City, updated quarterly Stakeholder lists (City has developed) Web-based tools Project-specific public facing web page that includes all project materials, engagement opportunity information, project contact information (email and distribution list sign up), and is regularly updated •City homepage banner to drive traffic to project page •Host web page on City website platform •Sample web pages •City of Spokane Housing Action Plan project web page— Project fundamentals •City of Tacoma Affordable Housing Action Strategy project web page— 30 second overview video •City of Lynnwood Housing Action Plan project web page— embedded survey link Email updates using existing distribution lists for project updates and engagement opportunities (Existing listservs include media list, Comprehensive Plan update distribution list, Bicycle and pedestrian plan distribution list, developers’ forum list, City Planner list) Online surveys to share information and request public feedback at key project milestones Social media posts at key milestones and to solicit participation in online engagement activities •Facebook, 4,000 followers; ability to boost posts •Twitter, 1,000 followers •LinkedIn: 1,150 followers •Instagram: 375 followers Events Stakeholder interviews FINAL 7/15/2020 4 City Council and/or Planning Commission meetings—online and recorded Existing city-sponsored community events—online and recorded o Greater Spokane Valley Chamber of Commerce informational meetings (target third or fourth quarter; Chamber does Zoom meetings in lieu of in- person) Roles and responsibilities Maul Foster & Alongi’s (MFA) communications staff, led by Charla Skaggs and Kate Elliott, will develop and assist with the implementation of this community engagement plan and related materials and content. City staff will be responsible for distributing notification letters and emails, posting web content, repurposing drafted content for social media posts, translating materials, serving as the primary point of contact for general public inquiries, and managing event and media relations including developing and distributing news releases and responding to media inquiries. As the community engagement plan is implemented, responsibilities for specific tasks will be determined through ongoing conversations, recognizing budgetary and time limitations for city staff. Outreach tactics and schedule (Schedule and tactics for planning purposes only and subject to change) Month Outreach Tactics Roles 2020 Draft and final community engagement plan MFA draft, city review June Stakeholder identification City lead Develop project web page and record “on-hold” City lead July message Stakeholder interviews MFA conduct Email/web update to describe Housing Action Plan MFA draft content purpose, need, and process Community information web page and survey #1 MFA draft content about housing needs assessment Media outreach regarding survey #1 Council/Commission check-in #1—PowerPoint City lead Presentation City lead MFA draft content Email/web update sharing housing needs August assessment report findings and feedback City lead Media outreach regarding findings September City magazine article, content due Oct. 15 MFA draft content October MFA draft content City lead FINAL 7/15/2020 5 Month Outreach Tactics Roles Community information webpage and survey #2 about policy and code changes Media outreach regarding survey #2 Email/web update sharing policy and code MFA draft content November changes feedback Council/Commission check-in #2—PowerPoint City lead Presentation Media outreach regarding findings City lead Email/web update sharing housing strategies reportMFA draft content December findings and implementation plan strategies Media outreach regarding findings City lead 2021 Email/web update sharing draft Housing ActionMFA draft content January Plan Media outreach regarding draft Housing Action City lead Plan Council/Commission check-in #3—PowerPointCity lead February Presentation Email/web update sharing final Housing Action PlanMFA draft content March and feedback received City lead Media outreach regarding final Housing Action Plan and feedback received April Email/web update announcing plan adoptionCity lead May Media outreach regarding final plan and adoptionCity lead COVID-19 implications for engagement Social distancing measures enacted during the COVID-19 outbreak have significant implications on the outreach processes outlined in this community engagement plan. As of mid-June, the situation is still rapidly evolving. MFA and city staff will coordinate regularly and follow all government-recommended measures to discourage in-person gatherings of people to help reduce the spread of the virus. Although the duration and intensity of social distancing measures continues to change, this plan assumes no in-person gatherings of 10 or more people through summer 2020. FINAL 7/15/2020 6 ATTACHMENT B DEMOGRAPHIC CHARTS B-1 Page ) Housing Action Plan City OF SURVEY RESPONSES ity of Spokane Valley ( C SUMMARY at participated in the Attachment B Demographic Charts_.docx \\ respondents th 01_2021.03.04 Memo \\ -ended questions asked in the survey follow Figure 8. Documents \\ demographics of the summarize the 1932.01 City of Spokane Valley \\ elected quotes from three open figures S final_dir.net \\ fs1 - survey. mfaspdx he following T(HAP) FIGURE 1: RESPONDENT AGE BY ZIP CODE \\\\ B-2 Page Attachment B Demographic Charts_.docx \\ 01_2021.03.04 Memo \\ Documents \\ 1932.01 City of Spokane Valley \\ RESPONDENT INCOME BY ZIP CODE final_dir.net \\ fs1 - pdx mfas FIGURE 2: \\\\ B-3 Page Attachment B Demographic Charts_.docx \\ 01_2021.03.04 Memo \\ Documents \\ 1932.01 City of Spokane Valley \\ RESPONDENT RACE BY ZIP CODE final_dir.net \\ fs1 - pdx mfas FIGURE 3: \\\\ B-9 cond o build Page ing.” mer head” ntennial Trail. Need more time home buyers assistance (i.e. silent se - Attachment B Demographic Charts_.docx \\ 01_2021.03.04 Memo \\ Documents \\ income housing. It will lower the price of other houses around and that’s not fair. And also brings alcohol, drugs and - 1932.01 City of Spokane Valley \\ building low final_dir.net \\ fs1 “My neighborhood is great but worry for friends who can’t find an affordable rental in a safe neighborhood.”“Getting too many duplexes in the neighborhood, not enough single housing.”“Need more affordable housing options of all types.”“Old trailers and messy trashy houses.”“They are breaking up the large parcels and putting in high density housing. It has created way more traffic than the road and neighborhoodwas designed to support. It is making my once quiet neighborhood noisy and obnoxious.”“It is a mixed neighborhood and the renters do not take as good of care as the owners.”“Need more parks, especially with basketball courts for teens and zip lines for the kids.”“Stop homeless to that area.”“Recreation. Need more areas to have biking/walking trails that connect to the Appleway Trail and Ceneighborhood hubs with restaurants, shops and recreation.”“I wish I know. The biggest problem currently is lack of inventory in houses for sale and houses for rent. Apartments are popping up allover but not a lot of alternatives for those that don’t want to live in an apartment.”“Help with affordable housing options in the form of ‘sweat equity’ type units and/or firstmortgage, etc.)”“By not regulating so tightly the ability to put ADUs on properties. We wanted to do this but getting electrical and the “hamdrive back to the spot was cost prohibitive. A parking spot is required for the ADU if it is separate from the house…Trying to put in aplace for my elderly mother has been awful. We have been unable to find what we need somewhere else so we are going to have tan addition.”“Keep plenty of open spaces and parks, while allowing more density in land use.”“Help with affordable housing for some our most vulnerable citizens as well as more support for those struggling with no hous“Incentivize low income, middle income, and mixed income housing.” - pdx mfas QUESTION: ARE THERE ANY ISSUES OR CHALLENGES THAT IMPACT QUALITY OF LIFE IN YOUR NEIGHBORHOOD? QUESTION: HOW CAN SPOKANE VALLEY IMPROVE HOUSING FOR OUR COMMUNITY? \\\\ B-10 blems Page on like the Scattered Sites project wide opti - and the Spokane Valley just feels like home. There are etc. Attachment B Demographic Charts_.docx \\ ls, easier shopping, less people…that, for the most part, is gone.” homes in their yards.” 01_2021.03.04 Memo \\ Documents \\ 1932.01 City of Spokane Valley \\ y events anyone can participate in and Spokane Valley actually listen to the citizens instead of doing whatever they want, no the area. Lots of green areas. A touch of city with a touch of country.” final_dir.net \\ fs1 “Allow single dwelling home owners to build tiny “More options for low income people to have a home instead of lumping us all together in crappy apartment complexes where proare compounded by being around other low income people that can’t get a foot up. Need a citythat SHA is ending.”“We honestly just need more housing. There very much seems to be a lack of affordable homes available or being built.”“Love “Large lots, family friendly, live and let live, less government.”“Low density living, quality school system and low traffic.”“It was sense of community, less traffic, better schoo“The schools, the views, close to everything.”“I’ve lived in the Spokane Valley, City of Spokane, North Idaho, Cheney, communitmatter what the citizens want.” - pdx mfas QUESTION: WHAT IS THE PRIMARY REASON YOU CHOSE TO LIVE IN SPOKANE VALLEY? \\\\ Ubc$21 APPENDIX E DEVELOPMENT FEASIBILITY AND MULTIFAMILY PROPERTY TAX EXEMPTION ANALYSIS DATE: February 1, 2021 TO: Maul Foster & Alongi (MFA), Matt Hoffman FROM: ECONorthwest, Tyler Bump, Jennifer Cannon, and James Kim SUBJECT: Evaluation of Key Housing Strategies for the Spokane Valley Housing Action Plan, Feasibility Analysis Introduction ECONorthwest in partnership with MFA is supporting the development of a Housing Action Plan (HAP) for the City of Spokane Valley to evaluate current and future housing needs and identify strategies to meet those needs. The HAP is largely made possible due to a Washington State Department of Commerce Housing Bill 1923 Grant. The overarching aims for the HAP are to include strategies to increase the supply of housing, and variety of housing types and actions to increase the supply of housing affordable to all income levels. The approach for developing a HAP began with an assessment of housing needs, public involvement, and analysis of the effectiveness of existing policies and potential updates to key regulations. All of this information collectively informs the strategic actions to be including in the HAP. A few of the housing strategies include modifications to existing development code and expansion of multifamily tax exemptions (MFTE) to encourage more housing variety and housing supply. ECONorthwest analyzed development feasibility of certain code modifications and the potential addition of MFTE program incentives to evaluate their effectiveness in improving the likelihood of development of townhomes and multifamily apartments. A development feasibility analysis tests the impact that various changes to development standards and incentive programs have on market-realistic development examples called prototypes. In addition, ECONorthwest provided Housing Action Plan content useful for describing the Multifamily Tax Exemption (MFTE) Program policy updates to consider. This memo provides the following Housing Action Plan sections: 1.Development Feasibility Analysis Findings 2.MFTE Program Overview 3.Development Feasibility Assumptions Section 1: Development Feasibility Analysis This section describes the findings from evaluating a set of key planning tools, specifically the multifamily property tax exemption (MFTE) and regulatory changes including modifications to the allowed density in certain zones and changes to other development standards. These planning tools were selected due to their potential to boost housing production, especially housing priced for low- to middle-income households. The multifamily tax exemption allows a local jurisdiction to incent diverse housing options in urban centers lacking in housing choices or workforce housing units. Essentially this program supports increased housing availability, possibly including ECONorthwest | Portland | Seattle | Los Angeles | Eugene | Boise | econw.com 1 affordable units, largely in mixed income developments conveniently located in urban centers. Washington State Chapter 84.14 RCW outlines the existing requirements for implementing a multifamily tax exemption (MFTE). This program exempts eligible new construction or rehabilitated housing from paying property taxes for either an 8-year or 12-year period of time. Only multiple-unit projects with four or more rental units are eligible for either the 8- or 12-year exemption, and only property owners who commit to renting or selling at least 20% of these units to low- and moderate-income households – earning less than 80% of the Area Median Income (AMI) – are eligible for the 12-year exemption. The City of Spokane Valley currently does not have a MFTE program established. Additional detail on the MFTE program is provided in Section 2. The density of residential buildings is partly determined by the maximum density allowances that the municipal code sets for each zone. Density allowances differ by zone and sometimes are specific to the type of residential building. Residential density is important for housing development because it determines the number of units that can be built on a parcel. Minimum lot sizes can also influence residential development since it can prevent development on lots below a certain size. The number and size of housing units that can be built on a parcel is also determined by requirements for non-residential uses or areas to be set-aside and not developed. Open space requirements (as well as setbacks and minimum landscape requirements) limit the residential building size on a parcel. The size of the building can also be limited by maximum lot coverage, which determines the largest share of a parcel that a building can be built on. Residential density can increase both horizontally and vertically and the maximum building height determines how high the building can be built, thus can restrict the height of residential development. PURPOSE OF THIS ASSESSMENT The purpose of this analysis is to examine a set of key program changes and policy levers that can help "tip" project feasibility for the MFTE program and regulatory changes in the City of Spokane Valley. The analysis focused on the following: R-4 zone (Townhomes): Increasing the residential density in the R-4 zone from 10 dwelling units per acre (du/ac) to 15 du/ac. Increasing residential density in the R-4 zone to 22 du/ac. Increasing the maximum lot coverage from 60% to 80% of the parcel for townhomes. Decreasing the minimum lot size for townhomes from 4,300 square feet to 2,000 square feet in the R-4 zone. Multi-Family Residential (MFR) zone (apartments): ECONorthwest 2 Increasing the residential density in Multi-Family Residential (MFR) zone from 22 du/ac to 40 du/ac. Elimination of Open Space Requirements for Multifamily Apartments within ¼ mile of City Parks. Increasing the maximum lot coverage from 60% to 100% for multifamily apartments. Increasing the maximum building height from 50 feet to 65 feet in the MFR zone. MFTE: Test out the addition of a MFTE program offering a 12-year tax exemption that would require at least 20% of the units be set aside for households earning 80% of the AMI or 1 less. In Spokane County, the AMI for a 4-person household is $77,400 in 2020. MFTE program without any increase in residential density in MFR zone. MFTE program with an increase in residential density to 40 du/ac in MFR zone. Summary of Development Feasibility Findings Below is a thematic overview of the findings from the development feasibility assessment. For more detail on the analysis, assumptions, and dollar values of the assessment results, please refer to the next section. Based on existing development standards and land prices in Spokane Valley, townhomes have limited feasibility in R-4 zone and 3-story garden-style apartments are not feasible in MFR zone given current land prices. The value of new development is limited by development standards that limit the scale of development that is possible on a parcel. Increasing density allowances is the best way to encourage development of townhomes and apartments in Spokane Valley. For garden-style apartments, the 12-year MFTE also makes projects more feasible, but it is not as impactful as increasing density allowances to 40 du/ac. Decreasing open space requirements, increasing maximum lot coverage, or increasing maximum building height is unlikely to have any meaningful effect on housing development in the near future. Development Feasibility Assessment Financial pro forma models are used to estimate the impact on development feasibility resulting from potential changes to development standards and incentive programs. More specifically, this analysis evaluates the residual land value (RLV) to understand development feasibility and the value that a change to development standards or tax abatements might provide. RLV is an estimate of what a developer would be willing to pay for land given the property’s income from leases or sales, the cost of construction, and the investment returns needed to attract capital for 1 Based on 2020 income limits in Spokane County. https://www.spokanehousing.org/wp- content/uploads/2020/07/Spokane_Utilities_Payment_Standards_2020_GD_HAP.pdf. ECONorthwest 3 the project. (These assumptions can be found in Appendix.) Figure 1 demonstrates in green the development value that is remaining after development costs and is available for acquiring land. Figure 1. Illustration of Residual Land Value, or Land Budget Source: ECONorthwest While there are other quantitative methods for calculating regulatory and incentive changes, such as an internal rate of return (IRR) threshold approach, all of the potential methods share drawbacks regarding the quality of inputs and sensitivity to those inputs. An advantage of the RLV approach is that it does not rely on land prices as an input. Rather, observed land prices can be compared with the model outputs to help calibrate the model and ensure it reflects reality. Because RLV is essentially a land budget, higher values indicate better development feasibility. To understand the impact the various policies, we created an analysis model that employs the same financial considerations a real estate developer would use to determine if a proposed development is financially feasible. These financial calculations are referred to as a pro forma model. A pro forma considers the size of the building allowed by zoning and the revenue that building can deliver (from rents and sales prices) relative to the costs of constructing and operating the building. We ran the pro forma model on example developments (or prototypes) that are reflective of the types and scales of development in the Spokane Valley area. Three prototypes are evaluated in this feasibility analysis. 1. 3-story townhomes on a 0.3-acre lot. Townhomes are 2-bedroom or 3-bedroom units with about 1,400 square feet (sf) to 1,700 sf of net floor area, sharing walls with neighboring units, a one-car garage on the ground floor, and a driveway that can function as an additional parking stall. They are assumed to sell at about $421,000 per unit on average. 2. 3-story townhomes on a 1.0-acre lot. These townhomes are the same as above, but they are laid out on two rows and share a private alleyway. They are assumed to sell at about $429,000 per unit on average. ECONorthwest 4 3. 3-story, garden-style apartments on a 2.5-acre lot. Apartments have a mix of various sizes ranging from 600 sf for a studio unit to 1,300 sf for a 3-bedroom unit. Residents and their guests have access to surface parking and a shared lobby or common space area. The average rent is assumed to be $1,400 per month. Increase in Allowed Residential Density The current zoning standards for R-4 zone allows up to 10 du/ac. The assessment of development feasibility based on certain assumptions (in Appendix) results in RLV of $9.1 per square foot (psf) for townhomes on 0.3-acre lots and $6.8 psf for townhomes on 1.0-acre lots. In comparison, the 2 Therefore, current zoning average value of land in the R-4 zone is between $8.0 psf and $12.0 psf. standards would allow some townhomes to be built in the R-4 zone, but they would not allow most townhomes to be built. Increasing the allowed density to 15 du/ac would allow an additional unit to be built on 0.3-acre lots and improve development feasibility by $5.2 psf. On 1.0-acre lots, the same density increase would allow 5 more units to be built and improve development feasibility by $9.1 psf. The increases in RLV are likely to make most townhome projects feasible since they raise the RLV above typical land prices ($8 psf to $12 psf). Moreover, increasing the allowed density to 22 du/ac would improve development feasibility to $24.8 psf for townhomes on 0.3-acre lots and to $28.6 psf for townhomes on 1.0-acre lots. The current zoning standards for MFR zone allows up to 22 du/ac, which results in RLV of $19.8 for a 3-story, garden-style apartment. This value is slightly below the typical land prices in the 3 Therefore, private developers are unlikely MFR zone, which ranges between $20 psf and $24 psf. to build 3-story apartments under the current zoning standards without a discount in the land price. To encourage the development of apartments in MFR zone, the City of Spokane Valley could increase the allowed density. For example, increasing the density allowance to 40 du/ac would raise the RLV of apartments to $42.9, which is significantly higher than the typical land prices. A policy lever that results in such a large increase in RLV may be warranted since some lands in the MFR can cost $30 psf. Increasing density allowance is a powerful tool to enable apartment development. 2 Land value is based on assessor’s data of properties in R-4 zone that were sold in 2019 and 2020. The average land price was about $10 psf. 3 Land value is based on assessor’s data of properties in MFR zone that were sold in 2019 and 2020. The average land price was about $22 psf. ECONorthwest 5 Figure 2. Feasibility Impact of Increasing Residential Density Source: ECONorthwest Note: Grey bars indicate feasibility under current development standards. Navy bars indicate feasibility under modified development standards. Green bars indicate the range of typical land prices. 12-Year MFTE Program Another policy tool to enhance development feasibility is the Multifamily Tax Exemption (MFTE) program. This statewide program grants an exemption from state property tax for eligible multifamily properties with more than 4 residential units. Cities can adopt an 8-year program that allows tax exemptions for eight years. Cities can also adopt a 12-year program that allows tax exemptions for twelve years for properties that designate at least 20% of their units to be income-restricted. Cities in Washington typically set the income limit at 80% of the AMI for rental units. From developers’ perspective the Figure3. Feasibility Impact of 12-Year MFTE Program 12-year MFTE program temporarily with and without an Increase Residential Density reduces property taxes while Source: ECONorthwest temporarily reducing rental income. On net, the benefit of the reduced property taxes outweighs the cost of lower rental income. The 12-year MFTE program improves the RLV of 3-story, garden-style apartments from $19.8 psf to $26.5 psf, which is slightly higher than the typical range for land prices. Combining the 12-year MFTE program with an increase in density allowance (from 22 du/ac to 40 du/ac) would improve the RLV to $55.2 psf, well above the typical range for land prices. ECONorthwest 6 Elimination of Open Space Requirements for Multifamily Apartments within ¼ mile of City Parks Under certain circumstances, open space requirements can be detrimental to development feasibility. Because open space takes up a portion of the lot’s surface, it limits the number and size of units that can be built horizontally. It also competes for space with surface parking area. Even for multistory buildings that can accommodate more units vertically, open space requirements can limit development density once the buildings reach a certain height. However, all of the apartment prototypes analyzed under the current development standards or modified development standards described above have low enough maximum residential density so that open space requirements do not impact viability of developing the prototypes. Even with a density allowance of 40 du/ac, 3-story apartments are not expected to take up more than a third of the lot, leaving plenty of space for driveways, walkways, surface parking, landscaping, and open space. Eliminating or reducing the open space requirement would make very modest improvements in development feasibility. Any reductions in open space would likely be replaced with landscaping rather than more units because the limits on residential density do not allow more units to be built. The improvement in development feasibility can be approximated by the difference in the cost of building an open space area and the cost of landscaping. Other Modifications There are other suggestions for modifying the development standards that have not been analyzed with a pro forma model because they have no impact on development feasibility. First, increasing the maximum lot coverage does not affect development feasibility because residential density allowances in the current development standards and the modified development standards we are testing do not allow the lot coverage of developments to reach more than 40 percent. Although increasing the maximum lot coverage will be important when residential densities are higher, it is not likely to yield meaningful results in the near future. Similarly, a higher maximum lot coverage will be important if developers want to build apartments with structured parking, but such developments usually require density allowance of at least 60 du/ac. Second, increasing the maximum building height from 50 feet to 65 feet for multifamily apartments is relevant for developers of apartment buildings taller than 4 stories. The maximum density allowances in the current development standards can be reached with a 3-story or 4-story building, thus the increase in maximum height is not tested in the feasibility assessment. Third, decreasing the minimum lot size for townhomes from 4,300 square feet to 2,000 square feet is not directly tested because minimum lot size requirements are, in some ways, equivalent to maximum density requirements. A minimum lot size of 4,300 square feet implies 10.1 du/ac (= 43,560 square feet per acre / 4,300 square feet per unit) and a minimum lot size of 2,000 square feet implies 21.8 du/ac (= 43,560 square feet per acre / 2,000 square feet per unit). These density ECONorthwest 7 limits are already tested in the feasibility assessment, though the 21.8 du/ac limit is tested as 22.0 du/ac. Minimum lot sizes can also be important for properties developed on small lots. However, because the smallest lot size tested in the feasibility assessment is 13,068 square feet (= 43,560 square feet per acre x 0.3), the reduction in minimum lot size is not relevant for the analysis. Summary of Feasibility Assessmentby Prototype Townhomes are barely feasible or not feasible under the current development standards. Their RLVs are $9.1 psf on 0.3-acre lots and $6.8 psf on 1.0-acre lots. In comparison, the typical land price ranges between $8 psf and $10 psf. However, increasing the density allowances would make townhome projects feasible. For multifamily apartments, the 12-year MFTE program is not as effective as it would be to increase density allowances to 40 du/ac. The 12-year MFTE program raises RLV by $6.7 psf, whereas increasing the density allowance from 22 du/ac to 40 du/ac increases the RLV by $23.1 psf. Notably, the combined effect of the 12-year MFTE program and higher residential density is greater than the sum of the two policy changes enacted independently. This is because the net benefit of the 12-year MFTE program is multiplied by the increased number of units that becomes possible with greater density allowances. Figure 4. Feasibility Impact of Various Policy Changes for All Three Prototypes Source: ECONorthwest ECONorthwest 8 Section 2. MFTE Program Overview What is a Multifamily Tax Exemption (MFTE) Program? The MFTE program enables a jurisdiction to incentivize mixed-income housing development and diverse housing options in urban areas lacking housing choices. Washington cities with a population of 15,000 can adopt a MFTE program to stimulate new multifamily affordable housing development. This program exempts eligible new construction or rehabilitated housing from paying property taxes for either an 8-year or 12-year period of time. Developers seeking to take advantage of this program must be within one of the city’s designated residential target areas which are often located in urban center or urban growth areas. If a jurisdiction offers the 12-year tax exemption, only property owners who commit to renting or selling at least 20% of these units to low- and moderate-income households are eligible per state law. In contrast, there is no 4 housing affordability requirement for the 8-year tax exemption option. Cities around Washington are using the MFTE program differently. For example, many cities in the southern portion of King County focus on using the 8-year program option to encourage redevelopment in target areas without housing affordability requirements since the initial goal was to redevelop older properties with newer, higher quality housing. Some cities are using the program to promote housing rehabilitation projects (such as the cities of Tacoma and Port Orchard). For housing rehabilitation projects, only the value of eligible housing improvements is exempted from property taxes. If a jurisdiction has aging multifamily developments or underutilized buildings suited to residential uses, they should consider whether rehabilitated units should be included in the MFTE program. Some jurisdictions restrict program use to multifamily projects with over 10 units and some other jurisdictions have made multiple-unit projects with 4 or more units (such as quad homes or townhomes) eligible for tax exemptions (City of Seattle). The MFTE program is increasingly being used in Washington state with an estimated 26 cities and one county establishing this program since 2007 and around 424 developments receiving tax exemptions (JLARC, 2019). Tax abatements positively impact the feasibility of projects where market-rate projects are feasible and can help cross-subsidize the affordable units. Cities considering a MFTE program should weigh the temporary loss of tax revenue against the potential attraction of new investment in target areas. State law does not prohibit MFTE from being paired with other incentives. Bonus units, incentives such as impact fee waivers, and the integration of a more flexible development agreement approach including performance requirements and a menu of corresponding incentives could help offset the costs incurred from affordable housing unit requirements and could be considered as a way to promote program usage. If the program requirements are not sufficiently mitigated by incentives, the profit required by the developer will not be actualized. The level of incentive necessary will vary greatly within a region and even vary within jurisdictions themselves depending on “submarket” conditions present at a site. Therefore, it’s 4 Chapter 84.14 RCW provides MFTE guidance for Washington State. ECONorthwest 9 important to thoroughly evaluate—and constantly refine—the incentives to make sure that they are priced according to the market, or they will not produce housing. Program Example: City of Renton MFTE Renton, WA is similar in population size and growth rate to Spokane Valley. The City of Renton allows applications for 8-year or 12-year exemptions. If applying for the 12-year exemption, then 20% of rentable units must be for households at or below 80% AMI. If applying for ownership project, then 20% of units must be reserved for households at or below 5 120% AMI. Depending on the zone, the City requires a minimum of 10 or 30 housing units to be built to qualify for the exemption. Renton passed their MFTE program in 2007. As of 2019, the program has built 1,535 units including 92 affordable units. Renton’s program has been successful in producing more market-rate units. Program Example: City of Spokane MFTE The City allows applications for 8-year or 12-year exemptions. If applying for the 12-year exemption, then they must reserve 20% of the housing units to renters with an income of no more than 115% AMI for moderate-income households 6 and below 80% AMI for low-income households.If developing a mixed-use project, then 50% or more of the project must include residential uses. In 2019, the City updated its MFTE boundary to include Center and Corridor Zones, Residential Zones, and Commercial Zones (See Figure 5). MFTE projects are exempt from the minimum off-street parking if within the Center and Corridor Zones. To be considered, developers must apply for the program before construction. The City of Spokane passed their MFTE program in 2007. In the program’s first four years, Spokane built 7 453 units. As of 2019, the program has built 1,751 units including 509 affordable units. FIGURE 5. City of Spokane MFTE Boundary 5 https://www.codepublishing.com/WA/Renton/html/Renton04/Renton0401/Renton0401220.html 6 https://my.spokanecity.org/economicdevelopment/incentives/multi-family-tax-exemption/ 7 https://static.spokanecity.org/documents/projects/multi-family-tax-exemption-2017-incentive-evaluation/2012-mfte- data-and-code-guide.pdf ECONorthwest 10 Key Program Variations: Housing rehabilitation versus new construction or both. Restricting program to only multifamily projects with over ten housing units or loosening up this restriction to allow “missing middle” housing with over four units (must be at least four units, per state law). Pair with other incentives such as impact fee waivers. A few programs (cities of Bellevue and Seattle) are providing a greater incentive for those providing family-sized units with over two bedrooms since program applicants tend to construct or rehabilitate one-bedroom or studio housing units rather than provide housing with over two bedrooms (JLARC estimates that approximately 75% of the units created between 2007-2018 are studios or one bedroom). MFTE Residential Targeted Areas can vary to include urban centers, mixed-use areas, transit-oriented development areas, or a mixture of these (RCW 84.14.040). Time period of exemption: 8 year, 12 year, or both. Depth of housing unit affordability (must be below 80%) and length of affordability (8 years, 12 years, or life of project). Policy Considerations: MFTE is a property tax subsidy to underwrite the voluntary participation to set aside housing units, income-restricted. The capitalized value of the subsidy supports both the affordable housing provision and developer participation/risk. More stringent restrictions could hurt participation in the program. Making the program as user-friendly as possible, can broaden program usage. A housing liaison at the City or affordable housing nonprofit partner can help facilitate program usage. Benefits: Tax abatements positively impact the feasibility of projects where market-rate projects are feasible. Project can help cross-subsidize affordable units. Can help broaden housing choices in the City. Drawbacks: Requires regular reporting to the state which helps track program usage. City must weigh the temporary loss of tax revenue against the potential attraction of new investment in targeted areas. ECONorthwest 11 Reduces general fund revenues for all overlapping taxing districts, which could make it harder to promote the tool to partner jurisdictions that do not perceive the same project benefits. May provide insufficient incentive to lead to affordability unless paired with other tools. ECONorthwest 12 Section 3: Development Feasibility Assumptions ECONorthwest 13 ECONorthwest 14 ECONorthwest 15 ECONorthwest 16 ECONorthwest 17 UBC$22 APPENDIX F AFFORDABLE HOUSING FUNDING SOURCES DATE: February 5, 2021 TO: Maul Foster and Alongi, Inc. FROM: ECONorthwest SUBJECT: State, Local and Federal Affordable Housing Funding Sources for the Spokane Valley Housing Action Plan Washington State, Local and Federal Affordable Housing Funding Sources This section describes the main state, local, and federal affordable housing funding sources available to developers looking to construct affordable housing properties in the City of Spokane Valley. This section focuses solely on funding sources, not indirect financing sources that provide financial benefits to affordable housing projects via reduced costs. Many of the funding sources could be allocated by the federal government but are administered by state and local housing finance agencies. Washington State Funding Sources As shown below, the Washington State Housing Finance Commission offers several funding programs to build multifamily affordable housing. The Low-Income Housing Tax Credit (LIHTC) program is the largest source of funding established for affordable housing and is an indirect subsidy (in the form of a reduced federal income tax liability) for private companies to invest in affordable housing. This program is administered by state and local housing finance agencies in accordance with U.S. Treasury Department stipulations. Generally, LIHTC recipients receive the credit over one decade and in exchange, the housing units must be kept affordable for at least three decades (states can stipulate a longer period). In Washington State, the Housing and Finance Commission provides two types of LIHTC programs: the 9% tax credit and the 4% bond tax credit program. o The 9% tax credit program is more valuable, but limited, and is awarded 1 competitively through annual funding applications. A few drawbacks are the competitive nature and the complex application process (can take several months) and reporting requirements. Large renovation projects tend to use the 9% option while smaller preservation and acquisition-rehab projects tend to take advantage of the 4% option. o The 4% bond tax credit program is less valuable for project financing, but the program is not always competitive. This option is available if more than half the project is financed with tax-exempt Multifamily Bonds. Any project that is able to make the funding program work can access the tax credits up to a certain bond 1 Source: Washington State Housing and Finance Commission, https://www.wshfc.org/mhcf/9percent/index.htm. ECONorthwest | Portland | Seattle | Los Angeles | Eugene | Boise | econw.com 1 cap across the state. These programs typically fund housing units that are affordable to households earning below 60% of AMI. Although the 4% bond tax credit program tends to not be competitive, there could be competition for the 2 bonds during certain years when demand exceeds availability The 80/20 Private Activity Bond program can fund construction and development costs for eligible affordable housing projects (e.g., multifamily rental housing, limited equity cooperative, assisted living, single room occupancy housing). The interest on the funding is tax exempt (also known as private activity bonds), thereby reducing total development costs and increasing project feasibility. This program typically funds housing units that are affordable to households earning below 60% of AMI. In return for this incentive, the 3 developer must set aside a certain percentage of units for low-income residents. Non-Profit Housing Bonds can assist 501(c)(3) nonprofits in financing numerous housing developments. These funds are more flexible than other types of financing programs. Nonprofit bonds cannot be combined with the LIHTC program incentives, but they can be used to finance a broader range of eligible activities and facilities (such as emergency 4 shelters for the homeless). The Land Acquisition Program assists qualified nonprofits and developers with purchasing land for affordable housing development (rental or homeownership). This loan helps developers buy land and then gives them the necessary time to build financing for building the housing. The Washington State Department of Commerce offers three additional funding programs for developing affordable housing. The Washington State Housing Trust Fund (HTF) provides loans and grants to affordable housing projects through annual competitive applications. This program typically funds housing units that are affordable to households earning below 80% of AMI. Recently at the end of 2020, the DOC announced that $85.3M of funding will be granted/loaned from the state’s HTF, with an additional $11.7M provided through HUD’s HOME and National HTF programs (both federal but managed by the DOC). This funding amount sets a new annual record of investment by the state HTF. This funding will be allocated to 30 projects and will help provide an estimated 1,404 multifamily rental units/beds, 121 homes for first-time homebuyers, 86 units of modular housing, and 74 units in cottage-style communities. The DOC will post a call for 2 Although the 4% bond tax credit program tends to not be competitive, there could be competition for the bonds during certain years when demand exceeds availability. Sources: Washington State Housing and Finance Commission, https://www.wshfc.org/mhcf/4percent/index.htm and Local Housing Solutions: https://www.localhousingsolutions.org/fund/federal-funding-for-affordable-housing/. 3 Source: Washington State Housing and Finance Commission, https://www.wshfc.org/mhcf/BondsOnly8020/index.htm. 4 Source: Washington State Housing and Finance Commission, https://www.wshfc.org/mhcf/nph/index.htm. ECONorthwest 2 applications for the 2021-23 biennial funds soon in 2021 at: https://www.commerce.wa.gov/building-infrastructure/housing/housing-trust- fund/applying-to-the-housing-trust-fund/. The Housing Preservation Program provides funding for affordable housing rehabilitation, preservation, and capital improvement needs. It is only available for 5 projects that have previously received Housing Trust Funds. The HOME Program is a federal block grant program funded through the U.S. Department of Housing and Urban Development (HUD) used to preserve and build rental housing affordable to low-income households. The Washington State Department of Commerce runs the HOME Rental Development program for Washington State HOME Investment Partnerships Program (HOME). This program offers funding for the preservation and development of affordable rental housing to non-profit organizations, public housing authorities, and local and tribal governments. HOME Funds typically build units that are affordable to households earning below 50% of AMI. Action plans are developed every spring to describe how the state will allocate funds for the next year. Participating jurisdictions must set aside at least 15% of their HOME funds for housing that is developed, sponsored, or owned by Community Housing Development 6 Organizations. Local Funding Sources 1)A property tax levy (RCW 84.52.105) – allows jurisdictions to place an additional tax up to $0.50 per thousand dollars assessed for up to ten years. Funds must go toward financing affordable housing for households earning below 50% MFI. 2)A sales tax levy (RCW 82.14.530) – allows jurisdictions to place a sales tax up to 0.1 percent. At least 60 percent of funds must go toward constructing affordable housing, mental/behavioral health-related facilities, or funding the operations and maintenance costs of affordable housing and facilities where housing-related programs are provided. At least 40 percent of funds must go toward mental / behavioral health treatment programs and services or housing-related services. 3)A real estate excise tax (REET) (RCW 82.46.035) – allows a portion of city REET funds to be used for affordable housing projects and the planning, acquisition, rehabilitation, repair, 5 Source: Washington State Department of Commerce Housing Preservation Program, https://www.commerce.wa.gov/building-infrastructure/housing/housing-preservation-program/ 6 Through the federal HOME program, the King County Housing and Community Development Department administers a Housing Finance Program (HFP) to provide capital funds for acquisition, rehabilitation, site improvements, new construction, and other costs related to housing development. Projects must apply for program benefits and the process is competitive. The HFP includes funds from King County's local Housing Opportunity Fund. Sources: Washington State Department of Commerce HOME Rental Development Program, https://www.commerce.wa.gov/building-infrastructure/housing/housing-trust-fund/home-program/ and ARCH, https://www.archhousing.org/developers/other-funding-options.html. ECONorthwest 3 replacement, construction, or improvement of facilities for people experiencing homelessness. These projects must be listed in city’s the capital facilities plan. Federal Government Funding Sources The U.S. Department of Housing and Urban Development (HUD) offers several different programs for developing affordable housing. Select programs are described below. Since 1974, HUD has provided Community Development Block Grants (CDBG) for the improvement of the economic, social and physical environment and quality of life for low- and moderate-income residents. Generally, these grants can address a wide range of community development needs including infrastructure improvements, housing rehab loans and grants as well as other benefits targeted to low- and moderate-income persons. A competitive process is typically used to allocate grants for individual projects and the amount of federal funding for CDBG has diminished over the past few years. o The local CDBG Program is administered by Spokane County’s Community Services, Housing, and Community Development Department since the City of Spokane Valley is part of the Spokane County CDBG Consortium (via an interlocal 7 The City of Spokane Valley is currently allocated approximately 20 agreement). percent of the consortium’s total CDBG award which ranges between $270,000 to $358,000. Eligibility is based on consistency with adopted priorities in the consolidated plan and whether the proposal targets broader community-wide benefits and low- and moderate-incomes (as determined by census tract) and residential uses. The HUD Section 108 Loan Guarantee Program is one mechanism available for CDBG (block grant) recipients to increase the capacity to assist with economic development, housing, public financing, and infrastructure projects by enabling a community to borrow up to five times its annual CDBG allocation. Communities can use these loans to either finance projects or to start loan funds to finance multiple projects over several years. The program has flexible repayment terms and is often layered with other sources of financing 8 such as LIHTC. HUD also provides two Section 8 funding programs that assist with rent payment. The Section 8 funding programs do not provide financial support to build affordable housing; rather, they provide support for households earning up to 80% of the AMI by paying the rent balance above 30% of the household income. HUD has a tenant-based Section 8 rental housing assistance offered primarily through the Housing Choice Voucher program. 7 Source: Spokane County https://www.spokanecounty.org/1240/CDBG 8 HUD Section 108 Loan Guarantee Program: https://www.hud.gov/program_offices/comm_planning/section108 ECONorthwest 4 o This voucher program is administered by the Spokane Housing Authority (SHA). Voucher holders gain a rental subsidy that can be used at any eligible rental housing. Consequently, this incentive moves with the eligible household rather than being tied to an affordable housing development. The other Section 8 program is a project-based voucher program providing a subsidy to specific housing units providing consistent affordability. SHA requires households to have 50% AMI or less and reserves 75% of units for incomes at or below 30% AMI. Since the assistance is connected to the housing unit, this program can help create or preserve affordable housing in high-cost, gentrifying areas. HUD 202 Supportive Housing for the Elderly: This program provides interest-free capital advances to private, nonprofit sponsors to finance housing development for low-income seniors. The capital advance does not have to be repaid as long as the project serves low- income seniors. The nonprofit must provide a minimum capital investment equal to 0.5 percent of the HUD-approved capital advance, up to a maximum of $25,000. Occupancy in Section 202 housing is open to any very low-income household comprised of at least 9 one person who is at least 62 years old at the time of initial occupancy. HUD Section 811 Supportive Housing for Persons with Disabilities: This program provides funding to build and subsidize rental housing for eligible persons with disabilities, in household income levels ranging from very low (50% AMI) and extremely low (under 30% AMI). At least one adult member in the household must have a disability such as a physical or developmental disability or chronic mental illness. A general aim of this program is help persons with disabilities live independently as much as possible. The program provides interest-free capital advances and operation subsidies to nonprofit developers. In addition, assistance is provided to state housing agencies in a variety of 10 ways such as Federal Low-Income Housing Tax Credits. Another HUD program supporting affordable housing rehabilitation is the Choice Neighborhoods grant program. This program is the successor to the HOPE VI program. This program funds the redevelopment, rehabilitation, and new construction associated with severely-distressed public housing and privately-owned HUD-assisted properties. A neighborhood revitalization plan (referred to as a Transformation Plan) describing the project goals and how it will address community problems and increase opportunities for 11 the residents and the surrounding neighborhood is required. 9 Source: HUD, https://www.hud.gov/program_offices/housing/mfh/progdesc/eld202 10 Source: HUD, https://www.hud.gov/program_offices/housing/mfh/progdesc/disab811. 11 Source: Local Housing Solutions, https://www.localhousingsolutions.org/fund/federal-funding-for-affordable- housing/. ECONorthwest 5 City of Spokane Valley Rent-Restricted Low-Income Housing Inventory Analysis City of Spokane Valley Rent-Restricted Affordable Housing Inventory Data Sources: Washington State Housing and Finance Commission (WSHFC), 2020, US Department of Housing and Urban Development (HUD), Spokane Housing Authority (SHA), and Community Frameworks (CF). Data Searches (mid 2020): HUD, USDA Rural Development Program (there were no properties in Spokane Valley), SHA, City of Spokane Valley, and PolicyMap. Notes: 0BR: is a studio. SRO: Single Room Occupancy. BR: Bedroom. We de-duplicated properties that appeared in multiple databases by looking at property names, total units, and addresses. We did not gather information on affordable homeownership properties, nor information on any housing vouchers. This information does not include homeless shelters or transitional housing that is not income or rent restricted. Lastly, we assume the WSHFC properties are all currently rent restricted, even if their LIHTC Year-15 has passed. While we cannot guarantee that the data is fully complete, it likely captures a robust share of the total rent-restricted affordable housing across Spokane Valley. ECONorthwest 6 Federal Government Designated Geographic Areas for Affordable Housing Support Developing a regulated affordable housing property can be a complex and difficult process. Different funding sources may have different priorities, and the costs of land and development can be prohibitive. To help alleviate some of these difficulties, the federal government has designated certain geographic areas to receive higher priority or more funding for regulated affordable housing development. These include Qualified Census Tracts, Difficult to Develop Areas, and Opportunity Zones, each described below. Qualified Census Tracts HUD defines a Qualified Census Tract (QCT) as a Census Tract with “50 percent of households with incomes below 60 percent of the Area Median Gross Income (AMGI)” or one where the 12 Affordable housing developments in QCTs that apply for poverty rate exceeds 25 percent. LIHTC funding receive a boost in the amount of tax credits they can receive. The City of Spokane Valley has a few QCT (see image below). 12 HUD. 2020. “Qualified Census Tracts and Difficult Development Areas.” www.huduser.gov/portal/datasets/qct.html ECONorthwest 7 Difficult Development Areas HUD defines a Difficult Development Areas (DDA) as “areas with high land, construction and utility costs relative to the area median income” and uses HUD Fair Market Rents, income limits, 2010 census, and 5-year American Community Survey (ACS) data as determinants. DDA properties using the Low-Income Housing Tax Credit (LIHTC) program can receive a 30 percent basis boost in qualified costs, increasing tax credits and resulting in greater investment equity in a project. The City of Spokane Valley does not include any DDAs. Opportunity Zones In addition, the 2017 federal Tax Cuts and Jobs Act created the Opportunity Zone program which is designed to incentivize investment in low-income communities by providing tax benefits. 13 While there are no Opportunity Zones are Census Tracts where the poverty rate exceeds 20%. specific funding boosts for affordable housing projects developed in Opportunity Zones, the tax incentives make other types of multifamily development more feasible. The City of Spokane Valley does not have any Opportunity Zones. 13 Washington State Department of Commerce. 2020. “Opportunity Zones-An Incentive to Invest in Lower-Income Areas.” https://www.commerce.wa.gov/growing-the-economy/opportunity-zones/ ECONorthwest 8 Affordable Housing Development Information This section describes the affordable housing development and finance process and how it differs from market rate development. Typical Affordable Housing Development Process The development of new, multifamily regulated affordable housing is a long and complex process. It is subject to many of the same development conditions as market-rate development, with added complexity due to lower rents requiring additional, lower-cost funding. The development process begins in predevelopment (design and feasibility, land entitlements, and funding applications) then enters construction, before beginning operations. The following are typical development phases for regulated affordable housing projects. Design and Feasibility Affordable housing developers start with an understanding of the need for less expensive housing in an area. How many units are needed at what rent level? What income levels have the biggest gaps in housing supply? What populations are struggling with housing costs the most? Just like market rate developers, affordable housing developers test the financial feasibility of what they hope to build against the local political and economic conditions. They must estimate what it will cost to build, what affordability levels the region needs, and the amount of funding available to build the project. If the project is not financially or politically feasible (i.e., cannot find adequate funding sources or does not meet a neighborhood’s goals), building the housing will be immensely challenging. Key challenges that are considered: cost of land, development allowed on the land (zoning), costs of construction, rents or prices, costs of operations (for multifamily), or local opposition to the project. How does affordable housing differ? Both affordable housing development and market-rate development need to go through design and feasibility. Affordable housing development differs from market-rate development in this stage due to limited funding. With the goal of providing below-market rents, the financing structure (often called the “capital stack”) of an affordable housing development needs to fill a gap (often called a “funding gap”) between what it costs to build the property and what the property’s operations can support. A market rate development will typically have investor equity and one or two types of debt financing, but an affordable housing development may also need to secure public funding, grants, operating subsidies, and low-cost or forgivable debt on top of competitive investor equity sources (see exhibit below). Some affordable housing developers need to secure predevelopment loans or grants as they work out the logistics of project feasibility. ECONorthwest 9 Sometimes, affordable housing developments are given free or reduced cost land, which aids feasibility and reduces the amount of debt needed. Typical Capital Stacks in a Market Rate and a 9% LIHTC Affordable Housing Development Source: ECONorthwest Land Use Entitlements This is the process of getting control of the site (buying land or assembling parcels) and getting the legal authority to develop (zoning and permitting, design review, neighborhood opposition, etc.). This can take months or years depending on the type of project, the required level of public review, the time it takes to obtain permits, the amount of neighborhood opposition, and many other factors. Developers typically take out pre-development loans to cover these costs, meaning that delays incur “carrying costs” (the interest that accrues on the loan each month of the process). This loan may be wrapped into or repaid by the construction loan. How does affordable housing differ? Both affordable housing developments and market-rate developments need to secure land use entitlements. One major way that affordable housing development differs from market-rate development in this stage, is due to neighborhood opposition. It is common for neighborhoods to object to a new affordable housing development, and some may use the slow land use entitlements process to delay or “kill” a project. Some market-rate developments may face opposition in this process, but they may also be in a better financial position to weather delays ECONorthwest 10 (e.g., if a market rate developer does not need a pre-development loan, delays do not incur carrying costs). Public Funding Applications This is a unique step required of affordable housing development that does not apply to market- rate development. Often, affordable housing developments receive public funding in exchange for renting to low-income households. With rents set below market, the property will have insufficient rent revenue to cover its operating costs and support the loans needed to pay for development. Thus, the property must apply for a range of low-cost funding, project equity, or grants to reach feasibility and begin construction. This step adds cost, time, complexity, and uncertainty to the development process. Because public funding is limited, these application cycles are very competitive and not all projects will receive the funding to move forward. The policy goals attached to each funding amount can influence the type of housing built (e.g., housing for families or seniors) as well as the income levels served. Most often, a project needs to have site control before it can receive funding. How does affordable housing differ? Market-rate developments do not typically need to secure public funding for development. Construction Once a property has site control, entitlements, and a confirmed design concept, it can begin construction. This stage depends on the availability of labor, materials, and equipment, as well as the complexity and size of the development. The project will take out a construction loan to cover these costs, which means that delays in construction incur additional “carrying costs.” The construction loan is repaid by the permanent loan, which is sized based on the net operating income of the project (rent revenues minus operating expenses). How does affordable housing differ? Affordable housing projects do not meaningfully differ from market-rate projects in the construction process. However, they may have simpler designs and prioritize faster construction timelines. Operations Once the project is built and leased, it begins operations. Rents are determined at the project feasibility stage and are very important in the project’s operating phase. Feasibility and funding applications can occur several years prior to the project operating. The revenues from property rents need to be high enough to cover the cost of operating the property (including maintenance and repairs, landscaping, taxes, and numerous other fees and costs). The project’s net operating ECONorthwest 11 income must also service the monthly debt payments on the permanent loan. Banks generally require an income “cushion” to assure that the property has enough operating income to pay its debts. This means that net operating income must be 15 percent to 20 percent higher than the debt payment. Any change in rent revenues (market softening, competition, vacancies, etc.), costs of operations (higher taxes, maintenance costs, capital repairs, etc.) can meaningfully disrupt a property’s operations. How does affordable housing differ? Affordable housing properties operate under affordability restrictions for a specified period of time (e.g., 15-99 years), and are typically managed by mission-driven developers or non-profit organizations. In contrast, many market rate properties will sell to an institutional investor after the property stabilizes (after 5 or 8 years of operations). Another difference in affordable housing operations is that typically, affordable housing properties are required to put a portion of operating funds into reserves (both capital reserves and or operating reserves) which serve as a cushion for unexpected vacancies, disruptions to operations, or major capital repairs. These reserves help prevent most affordable housing properties from defaulting on debt service requirements (LIHTC properties, in particular, have very low default rates). Market rate properties are not required to keep reserves. Lastly, another difference in affordable housing operations, is that often the properties may have insufficient cash flow (funds left over after paying for operating expenses and debt) to pay for any cash-flow dependent line items (e.g., the developer fee, cash-flow dependent loans, etc.) In contrast, market rate properties seek financial returns from the property, to provide steady cash flow to the owner or investor. While cash flow is not always available due to market rent fluctuations and or vacancies, the deals are structured to seek financial returns. Development Context There are a large number of interrelated variables to consider where affordable housing will be the most profitable for developers; among these variables are: Base regulations– base density, height limits, lot coverage or floor-area ratios, etc. Incentives – fee waivers, density and height bonuses, direct financial contributions, etc. Inclusionary requirements – length of restrictions, set aside amounts, income levels, etc. Market conditions – base rents, area annual income growth, land costs, etc. Infrastructure – mobility (transit, roads, and trails), parks, stormwater, etc. Internal metrics – developer internal rate of return, finance costs, etc. ECONorthwest 12 The difficulty in balancing these variables is that since each site, each project, and each developer have such widely varying characteristics, there is no single equation that results in the provision of affordable housing; each party can only make decisions that affect their span of control: Developer: Choosing a region with anticipated profit, controlling for land costs, reducing the quality of the units, or charging increased prices for the finished units; since the first is sometimes fixed, and the last two are tied to market rates, controlling for land is often the overriding factor. Jurisdiction: Reducing regulatory burden—parking requirements, impact fees, permitting timelines, cost of compliance, etc.—or increasing incentives. Outside of control of either party: Financial markets, regional economic growth/decline. The challenge with affordable mandates is to price the associated incentives in a way to mitigate the costs. ECONorthwest 13 UBC$23 APPENDIX G ACCESSORY DWELLING UNIT AND TINY HOME POLICY ANALYSIS DATE: February 1, 2021 TO: Maul Foster & Alongi (MFA), Matt Hoffman FROM: ECONorthwest, Tyler Bump, Jennifer Cannon, and James Kim SUBJECT: DRAFT Evaluation of Key Housing Strategies for the Spokane Valley Housing Action Plan Introduction ECONorthwest in partnership with MFA is supporting the development of a Housing Action Plan (HAP) for the City of Spokane Valley to evaluate current and future housing needs and identify strategies to meet those needs. The HAP is largely made possible due to a Washington State Department of Commerce Housing Bill 1923 Grant. The overarching aims for the HAP are to include strategies to increase the supply of housing, and variety of housing types and actions to increase the supply of housing affordable to all income levels. The approach for developing a HAP began with an assessment of housing needs, public involvement, and analysis of the effectiveness of existing policies and potential updates to key regulations. All of this information collectively will inform the strategic actions to be including in the HAP. ECONorthwest provided Housing Action Plan content useful for describing Accessory Dwelling Unit (ADU) and Tiny Home policy updates to consider. Accessory Dwelling Unit Policies ADUs, also referred to as mother-in-law apartments, carriage house, granny flat, second unit, are a self-contained residential unit that is an accessory use to a single-family home and is located on the parcel with a single-family home. An ADU typically contains all the basic facilities needed for living independent from the primary residence such as a kitchen and bathroom. ADUs tend to be smaller in size and scale to the primary single-family home. ADUs can be considered a form of missing middle housing helping to bridge a gap between single-family housing and multifamily housing. Generally, this type of housing can be built at a lower cost per unit than single-family detached housing; however, this is not guaranteed. An ADU can be configured in different ways such as being attached to a single-family home, above a garage, or detached from the primary residence. See the examples shown below. Source: AARP, 2018 ABCs of ADUs Guide and images. ECONorthwest | Portland | Seattle | Los Angeles | Eugene | Boise | econw.com 1 1 Spokane Valley ADU Regulations: Type: Both attached or detached are permitted. Quantity: One ADU is allowed per lot. Creation: ADU construction is allowed with new or existing primary unit. Eligibility: ADUs are not allowed on lots with a duplex, multifamily dwelling, or accessory apartment. Parking: One off-street parking space required for ADU in addition to existing parking requirements. Design Standards: Appearance: ADU must match primary dwelling unit’s exterior finish materials, roof pitch, trim, and window proportions and orientation. No guidance on height limits. Entrance: An attached ADU entrance must be on the side or in the rear to maintain single-family appearance. No guidance for detached ADU. Size: ADU cannot be larger than 10% of lot or 1,000 sq/ft (whichever is greater) and larger than 300 sq/ft while not exceeding 50% of the habitable square footage of primary dwelling unit. And have no more than two bedrooms. Setbacks: ADU must comply with existing side and rear setback requirements for a dwelling unit. For some properties this would be a 20-foot rear setback and for others the rear setback could be 10 feet. Permit Fees: It is not clear from the Master Fee Schedule found in Resolution NO. 20-016 which fees apply to ADU permit fees. Clarifying which fees apply to ADU development will help reduce questions and streamline the process. Below are some fees that may: ADU Planning: $300 Building: $391.25 – $993.75 Site Plan Review:$80 Certificate of Occupancy: $84.00 Transportation Impact Fee: $1,260 Other: Cargo shipping containers are not permitted as an ADU in residential zoning. Industrial ADU: This is another type of ADU allowed in Spokane Valley. Code does not specify which zone it is permissible to build this type of ADU. Main difference from a regular ADU is that 10 industrial ADUs are allowed per site and are prohibited on the first floor of the building. Policy Considerations: 1 City of Spokane Valley Municipal Code Section 19.40.030 Development standards – Accessory dwelling units. ECONorthwest 2 Adding off-street parking space in addition to the existing parking requirements can make an ADU more expensive to develop. Parking space requirements tend to increase the cost of development and can make the development physically impossible when taking into account the primary and accessory parking unit requirements. Lowering parking space requirements can be a helpful way to encourage ADU development. If on- street parking is available or garage or driveway space is available, the City should consider waiving onerous parking requirements such as prohibiting the use of the driveway, garage, or carport areas to count for parking. Especially if owner-occupancy is required, ADUs tend to be located on a lot with shared parking arrangements and the availability of parking can be coordinated with the primary residence (likely the landlord) living on-site. Parking spaces could easily cost $5,000 to $7,000 which, given the cost of development of an ADU, can add substantial cost such that it becomes a barrier for homeowner financing. Generally, requiring owner-occupancy of one of the units can negatively impact ADU 2 The City of Renton exempts owner occupancy requirements in exchange production. for 60% AMI affordability. The City should explore whether there are feasible opportunities to relax the size limitations to allow for more flexibility and larger units and smaller units that could result from the conversion of garage spaces. Relaxing the ADU setback requirements (particularly the side and rear) to five feet could make ADU projects more feasible, particularly on lots with irregular or elongated shapes. A city might institute strategic fee waivers for affordable units to encourage more development, or lower-cost development. Increasing the density to allow for two ADUs per lot could be helpful particularly if the City sees increasing demand for ADU housing options. Jurisdictions will not see large numbers of ADUs actually being constructed until the market rents reach a level that makes development feasible. Monitor: Cities possibly will need to address short-term vacation rental use of ADUs and spillover effects in terms of parking, service, and neighborhood impacts. Benefits Associated with Promoting ADU Development: Broadens housing diversity and choices in a broader range of neighborhoods since it can be offered at a more affordable cost due to their small size. Although ADUs can be cheaper housing options, this lower cost is not always the case. Offers additional options for Seniors and younger populations, single person households, etc. Can be a source of added income to help pay housing expenses. 2 https://www.planning.org/knowledgebase/accessorydwellings/ ECONorthwest 3 AARP surveyed people 50+ and found, they would consider creating an ADU to provide a home for a loved one in need of care (84%), provide housing for relatives or friends (83%), feel safer by having someone living nearby (64%, have a space for guests (69%), increase the value of their home (67%), create a place for a caregiver to stay (60%), and earn extra income from renting to a tenant (53%) Source: AARP Home and Community Preferences Survey, 2018. (AARP Home and Community Preferences Survey, 2018) ADUs can blend into single-family neighborhoods and be a form of intergenerational housing. Tiny Home Policies Over the last decade, various factors have led to households downsizing and people choosing to live in smaller, more affordable, and environmentally sustainable dwellings. The concept of living smaller has been gaining momentum and new models of tiny housing have been popping up in cities throughout the country. Tiny houses are one way to provide a housing option for individuals and households who desire privacy and smaller home size but prefer single-family dwelling home amenities. Tiny homes, sometimes referred to as micro-homes, are small, single-family dwellings, typically 80 to 3 200 square feet but usually always less than 500 square feet. Tiny homes often have a kitchen and a bathroom and they can be on wheels (temporary or transitional) or on foundation (permanent). Tiny homes are an attractive option for home dwellers because they cost less than a traditional home and do not require a mortgage; units require less energy and utility services; and some tiny homes, especially those on wheels, provide dwellers the flexibility of movement. Tiny homes can be built entirely on the site (stick-built/site-constructed) or can be built elsewhere and transported to the site such as a factory-built modular home. Tiny house communities including property that can be rented or held by other others for the placement of tiny houses can also provide transitional housing for those experiencing homelessness (these villages have been built in Olympia and Seattle). Until recently, state law, building codes, and local regulations have presented numerous legal and logistical barriers to siting and building these very small, detached dwellings. In 2019, the state legislature passed ESSB 5383, which updated state law to enable the development of tiny houses or tiny house communities throughout the state. This law defined tiny houses, and mandated that the building code council write building codes for tiny homes. Washington state has adopted Appendix Q Tiny Houses which relates to tiny homes on a foundation. The City of Spokane Valley could consider the following policy updates/additions: 3 Brown, Emily (2016). Overcoming the Barriers to Micro-Housing: Tiny Houses, Big Potential. University of Oregon Department of Planning, Public Policy, and Management. ECONorthwest 4 At a minimum, the City should define tiny houses to differentiate from trailers, manufactured homes, and recreational vehicles. Tiny homes on wheels might be challenging to address initially due to challenges with zoning compliance, waste-water treatment, and site design. Some communities have adopted building codes that allow for long-term occupancy of tiny homes, but in many towns and cities the legality of long-term occupancy hinges on whether the tiny home is on a permanent foundation and connected to public utilities. Consequently, focusing on clarifying regulations with tiny houses on foundations (not on wheels) could be addressed as a first step. The City could allow tiny homes, set on a foundation, to be utilized as an ADU. Zoning code requirements can create additional barriers: Tiny homes may not be addressed in the zoning code as a permitted use, and if so, there may be a limit on which zoning areas allow them. Certain zoning areas have minimum lot size, setbacks, and parking requirements that are prohibitive. The City of Walsenburg, Colorado’s city council eliminated a zoning code that prohibited residential dwellings of 600 square feet 4 The permitted use table or less, allowing more housing in the mountain-town city. should be modified to identify where tiny houses or tiny house villages would be permitted outright or conditionally allowed. The building code can be the most significant hurdle for legally constructing a tiny home. The City should consider whether to adopt the updated International Residential (2018) since this has been modified to encompass tiny Code (IRC) with Appendix Q house construction. This IRC defines a tiny house as a dwelling smaller than 400 square feet excluding lofts. The Washington state legislature (via ESB 5383) recognizes that the IRC has issued tiny house building code standards in Appendix Q which can provide a 5 basis for the standards requested within this act.As a first step, the City should solicit input or convene a focus group or working group including tiny house owners and developers, city planners, and city building code experts to review how tiny homes would fit in the existing site plan approval process and identify regulatory barriers and possible areas of flexibility related to the use of the IRC. 4 For more information, visit: https://www.cityofwalsenburg.net/tiny-homes 5 The cities of Seattle, Tacoma, and Olympia have adopted Code to address tiny homes. ECONorthwest 5 UBC$24 The housing supply in the Spokane continues to fall to record low levels at all pricing points. In February of 2021, we gathered the top minds in the industry at the national, regional, and local levels to provide a market-based analysis of housing needs for our region. This white paper serves as a guidepost that provides a full picture of the true need for housing, the impacts of housing policies in our region, the needs of Spokane, what residents want, the influence of buyer migration from larger metro markets, a history of under-supply and the social impacts to our community. 1 We must no longer turn a blind eye to the impacts in our community from a severe lack of housing. For more than a decade, we have failed to build enough homes to meet demands. As a result, housing prices are increasing at never-before-seen pace. To find answers as to why, the Spokane Association of REALTORS® gathered some of the greatest minds, with national, regional, and local standing, for a Spokane Region Housing Needs Summit. Their voices make it clear as to the impacts this is having on our community. This report lays out the challenges facing our industry and our communities. I encourage you to keep this as a reference guide for the discussions ahead. As REALTORS® - we are uniquely positioned to advocate for change. It is a responsibility we must now bear, to best serve our neighbors, our community, and our industry. Let us get to work! Eric Johnson 2021 President Spokane Association of REALTORS® 2 Executive Summary The housing crisis in the Spokane region has reached a critical level and is threatening the stability of our region. That is the consensus of a panel of national and regional economists and housing experts who came together for a Spokane Region Housing Needs Summit hosted by the Spokane Association of REALTORS®. These experts were brought together to help us better understand the true housing needs of the Spokane region, and the answers they provided were alarming. Among the key findings: The Spokane area’s housing supply is severe, with a 94% reduction in available homes for sale since 2010. A lack of inventory has escalated the median home price in Spokane County 66.8% since 2015 with a median home increase from $179,000 (2016) to over $300,000 (2020). From 2010 to 2019 the Spokane Regionunderbuilt approximately 32,000 housing unitsto meet demand. This has resulted in lost economic opportunity - $6-billion dollars in wages and employment since 2010, $1.1-billion dollars in immediate and ongoing tax revenues. A lack of inventory has led to thousands of families renting who cannot find a place to buy. Vacancies in regional rentals remains at a dangerous level of around 1%. The biggest lack of inventory lies in entry level or workforce housing. From personal health to family stress, to student performance in school, to increased levels of homelessness, Spokane’s lack of housing has triggered a severe impact on the health of our citizens – especially among minorities and our youth. Spokane has high levels of cost-burdened families spending more of their income on shelter than most similar cities in the state and the US. The Spokane Region is among the top places to move in the country with expected growth of 48,000 more people by the year 2030. Many new homebuyers are migratingfrom larger West coast markets adding 8-to-14,000 new residents annually The market has shifted with bulk of new homes in our region now built across the border in Idaho. Local public policy has resulted in the lack of housing production. In the City of Spokane’s 20-year plan to build around centers and corridorsnot one single development has happened You can watch the summit for yourself here- https://www.youtube.com/watch?v=5t7NYNhMwYI 3 Table of Contents "Spokane Region Housing Costs and Supply” Spokane Association of REALTORS® .................................................................................................................. 5 "Housing Affordability and the First Time Homebuyers Squeeze” James Young –Director of the Washington Center for Real Estate Research ................................................... 7 “Housing Growth Continues as the Economy Recovers in 2021” Danushka Nanayakkara-Skillington - NAHB Assistant VP for Forecasting and Analysis ................................ 11 "Housing Underproduction for Washington State and Spokane" Mike Kingsella – Up For Growth National Director ......................................................................................... 15 "Spokane Emerges As A Top 10 Real Estate Market in a Post-COVID Environment" Jessica Lautz –VP of Demographics and Behavioral InsightsNational Association of REALTORS®................. 19 "A Summary of Population Forecasts and Origins of Recent Newcomers to Spokane County" D. Patrick Jones, PhD – Executive Director of EWU’s Institute for Public Policy & Economic Analysis .......... 22 "The Social Impacts of Low Housing Stock in Spokane" Vange M. Ocasio Hocheimer, PhD – Associate Professor of Economic, Whitworth University Research...... 28 "Housing Needs Assessment Survey for Spokane Spring 2020" Sara Stephenson –American Strategies .......................................................................................................... 33 "The Shifting Marketplace: How Spokane Lost Market Share to Kootenai County." Jim Frank – Director of the Washington Center for Real Estate Research ....................................................... 37 "The Missing Housing Supply for Low Income Families " Ben Stuckart – Spokane Low Income Housing Consortium ............................................................................. 40 "Broken Pledges Under the Growth Management Act" Al French – Spokane County Commissioner .................................................................................................... 42 4 Spokane Region Housing Costs and Supply -Data supplied by the Spokane Association of REALTORS® Spokane County is currently suffering from the lowest level of housing supply in history. In housing terms, there is under a 10-day supply of homes. By contrast, a 4-to-6-month supply represents a balanced market. This is a trend that we have seen growing since 2010. MLS Housing Availability Data 2010-2021 2,348 94.3% Decrease 2010-21 1,427 164 201020172021 Homes for Sale end of January Source: In raw numbers, there were 2,348 homes available in January of 2010. By the end January of this year, that number had fallen to 164 homes. This represents a housing inventory reduction of 94%. MLS Lockbox Openings Data 2012-2020 45% 2012-20 21,274 20,903 14,664 201220162020 Showings for August Source: During this time frame (data kept since 2012) we measured data for the number of home showings as a representation of customer demand. Was we have seen in an increase in the showings of homes by 45% as measured by the number of lockbox openings. 5 MLS Housing Data 2010-2020 300,000 66.8% Increase 2015-20 283,527 234,900 210,000 195,000 179,900 168,000 164,500 163,312160,000 154,300 20102011201220132014201520162017201820192020 Median Home Prices for Spokane County Source: As a result of this increased demand, and reduced supply the cost of housing in the Spokane Region has continued to accelerate. Since 2015, the median priced home in the region has gone from $179,000 to $300,000. This represents an increase of median priced homes of 66.8% from 2015 through 2020. By comparison, median home prices increased from 2010-2014 by only 2.8% These statistics represent the sales of single-family homes on less than one acre, including condominiums. 6 Housing Affordability and the First Time Homebuyers Squeeze James Young – Director of the Washington Center for Real Estate Research The Spokane Housing Market continues to show a rapid decline in affordable homes, particularly for those looking to enter the home ownership ranks for the first time. As recent as the third quarter of 2015, home ownership has been attainable by roughly 100% of buyers making 85% of the median income in the Spokane Region. Today, those numbers translate to under 75% of renters. Too often, those who have saved up and are ready to buy face a regional supply of less than a handful of homes. The market is seeing multiple offers (often 20 to 30 offers) on these entry level or workforce homes priced at $250,000 or below, with an average time on market of just a few days before going under contract. Spokane has long exceeded the rest of Washington for affordability, but in the past few years, that status has changed, especially for first time homebuyers. First Time Buyers Index 140.0 120.0 100.0 80.0 60.0 40.0 20.0 0.0 SpokaneWashington Source: Washington State Housing Market Report: WCRER 7 As home prices continue to escalate, more and more buyers are being squeezed out of the marketplace. This is especially true for those seeking to buy their first home, or transition down to a smaller home. First Time Buyer Market Dynamics 220,00050.0% 210,00045.0% 200,00040.0% 190,00035.0% 180,00030.0% 170,00025.0% 160,00020.0% 150,00015.0% 140,00010.0% 130,0005.0% 120,0000.0% 2014201520162017201820192020 Spokane % Sold Source: Washington State Housing Market Report: WCRER Since 2018, the available housing for first time home buyers has fallen to roughly 15% of the marketplace. This has resulted in tremendous pressure on the rental market with vacancies falling to an unhealthy rate of about 1%. Rental Housing Market Spokane Rents and Vacancies 12004.00% 3.50% 1100 3.00% 1000 2.50% 900 2.00% 800 1.50% 700 1.00% 600 0.50% 5000.00% SpringFall 2014SpringFall 2015SpringFall 2016SpringFall 2017SpringFall 2018SpringFall 2019SpringFall 2020 2014201520162017201820192020 Average RentVacancy Rate Source: Washington State Housing Market Report: WCRER 8 These rising rental rates create what we call the Prisoner’s Dilemma, where renters find themselves using more of their resources month-to-month for housing costs, instead of being able to save up for a down payment. Building Permits by Type Building Permits by Type 4000 3500 3000 2500 2000 1500 1000 500 0 2011201220132014201520162017201820192020 Single Family Source: US Census Bureau, WCRER As a result, the marketplace has reacted with a dramatic increase in multi-family rental units during this same time period. To put this in context for each construction type - that is more than the TOTAL all of the building permits issues in the years 2014, 2013, 2012, and 2011. Condominium construction is now less than 10% of the marketplace in 2020, with over half of these new units age restricted to those 55 and older. 9 Security and Tenure SF Houses close to the city >Housing Ladder Higher-end townhouses close to the city High-rise urban condominium - SF Houses inner suburbs Ownership - TH close to the city High-rise urban condominium – Trade-up SF Houses in suburbs TH in inner suburbs MISSING HIGHER DENSITY HOUSING OPTION Townhouses in mid-suburbs Ownership - Quality MISSING HIGHER DENSITY HOUSING OPTION First- Rent/Price Townhouses in outer suburbs buyers MISSING RUNG OF THE LADDER ON SUPPLY High quality MF Suburban Housing Medium Quality MF Housing closer to the urban core Rental Tenure High quality MFH in the suburbs Medium quality MFH closer to the urban core Older apartments and hotels -ADUs In conclusion, with steady interest rates we should see first-time buyers able to afford more of a home than in the past. But this major decline in existing home listings has created a shortage of supply, and has created a “Prisoner’s Dilemma” in the marketplace. The pre-Covid demand trends have only been accelerated during this time period, making it clear that a lack of supply for first time buyers is creating acute problems in the Spokane housing market. As a result, this housing demand has nowhere to go but the rental market. This will become problematic in the next few years as Spokane finds itself unable to meet owner’s expectations. Both for those living here, and those who are migrating here from West Coast Urban Centers. The key to solving this dilemma is clear. Housing supply leads to ownership opportunities. Without them, the market will continue to make home ownership more and more difficult. 10 Housing Growth Continues as the Economy Recovers in 2021 Danushka Nanayakkara-Skillington – National Association of Home Builders Assistant Vice President for Forecasting and Analysis The national economy was growing at a strong and steady pace of about a 3.4% GDP growth until the advent of the coronavirus shutdown. The result led to a complete reversal with a negative 3.6% fall in GDP for 2020. We see this growth trend resuming once the effects of Covid 19 have been reduced. While there are immediate concerns with the effects of the emerging new mutations of the virus, we are optimistic that the roll out of vaccinations will help move the economy to a more normal pace. As such, we see the GDP growth nationally to reach 3.6% for 2021, and 4% in 2022. 11 Spokane’s employment rates have lagged the rest of Washington,while the economic recovery appears to have resumed, but has flattened out slightly in comparison to the rest of the state. The good news is that the Feds are all-in with their financial support of the economy. Since 2009, the Federal Funds top rate has remained below 1%. While there was a temporary raising of the rates from 2017 to 2020, the rate has returned to below 1%, giving strong support towards interest rates staying low for the near-term. 12 Home prices in Spokane are predicted to continue a strong upward movement with an average annual increase projected to be between 8.04% and 12.15%. This puts Spokane in the top 20 markets for Home Price Growth based on a lack of inventory and a growing demand for homes. While Spokane still ranks above the National mark for housing affordability, we see that number continuing to fall into 2021 with ann affordability index going below 63%, 13 Spokane saw an increase in softwood lumber prices since mid-April of 177%(from $350 per thousand board feet, to $966 April 2020 to Feb 2021), which has added about $16,000 to the average price of a home. Yet, Spokane’sRegulatory Costs related to the share of home prices stands between 24.3% and 30.3% of the home construction costs when compared to other markets in the country. The good news is that there is tremendous economic opportunity that comes with an increase of housing supply. On average, each new home adds $188,962 in wages and salaries to the economy, along with 2.9 jobs. (NAHB also projects $3.6 million in local tax revenues for each 100 homes built - ) 14 Housing Underproduction for Washington State and Spokane Mike Kingsella Up For Growth National Director “Spokane’s housing stock is rapidly becoming unaffordable. From 2010-2017 Spokane ranked as the number one most affordable entry level home city in the th country. Today it’s 45 (of 100) and falling.” Source: AEI Carpenter Index Across the State of Washington, and in Spokane County in particular, there are not enough homes relative to need. While this is a trend many attribute to being a nationwide problem, we see the biggest challenges to growth lies primarily on the West Coast. In Washington State, this lack of production has not kept up with growth going back to 2010, with the State underproducing some 225,000 homes from 2010 to 2017. ECO Northwest that compiled this data for us determined that Spokane county’s growth figure represents approximately .73 homes for every new family, with a national average of 1.06 homes per family. 15 The high cost of underproduction can be measured in several key areas, specifically in greenhouse gas emissions, loss ofgrowth and revenue to residents and in lost tax revenue benefits. In Spokane, this lack of construction has dramatically shifted the cost burden of housing, both in terms of rent and ownership with severe impacts to 22% of homeowners and 48% of renters. This results in about 73,000 households facing cost burdening, averaging out to roughly one in three families. 16 Cost-burdening happens when families pay more than 33% of their income towards their total housing costs. The additional challenge for those renters who are cost-burdened is that it makes it incredibly difficult to save for a down payment to purchase a home. The impact of home ownership continues to drop with each rising cost of housing. Across the board we are seeing fewer and fewer people able to afford a home in Spokane. 17 Updating our numbers from the 2017 study, we see a continuation of the housing underproduction in Spokane County. Given the aging housing stock in Spokane, with a higher percentage of post-WW2 housing built (in conjunction with ECO Northwest) we have determined that Spokane’s housing unit needs are at 1.15 homes per new household. In the final analysis, time is of the essence. With building costs, land acquisition and regulatory costs on the rise, the result is the cost of entry level housing is increasing, with fewer units being built. Long run affordability requires sustained production of housing units. We believe better planning, zoning, and land-use policies can help builders better meet the market, delivering more inventory, while increasing housing affordability in the process. 18 Spokane Emerges As Top-10 Post-Covid Real Estate Market Jessica Lautz – VP of Demographics and Behavioral Insights – National Association of REALTORS® “-- The National Association of REALTORS® has released its Economic forecast for 2021-22 and has determined that Spokane will be among the top 10 housing markets in the United States as a Top-10 Post-Covid Real Estate Market. 19 The Spokane-Spokane Valley Metro area stands out as having the highest fraction of its movers from West Coast Areas, accounting for23.8% of people who moved in the area in 2018. In terms of movers, Spokane stands with Phoenix/Scottsdale as the most attractive for West Coast movers. A high fraction of this migrating workforce works from home, at 7.1%. While house prices have gone up substantially in the last 5 years, prices here remain very attractive from expensive West Coast metro areas. Among the prominent numbers used in making our assessment, we noted that over 8,000 people moved here in 2019, mimicking a similar migration in 2018. This represents nearly one in four movers escaping West Coast metro areas. (8.312 of 34,896). Based on other regional cities, Spokane looks very attractive from a Qualifying Income perspective. With 5% down, buyers in Spokane can qualify for a home with an annual income of $61,500 versus say Seattle with a $116,300 qualifying income. 20 With the number of businesses that have closed due to Covid, there is an increased opportunity for small business creation in the Post-Covid era. One in six homebuyers are now seeking a multigenerational home, with fits the Spokane profile. Aging parents are the number one reason, with children under 30 the second reason at 54% Offsetting this number is falling number of buyers with children, at 58% of homes in 1985 down to only 33% today. Washington’s economic recovery is moving slower than much of the country. 46.4% are working from home. 19.55% expect a loss of income in the next 2-months. 25.7% are having difficulty paying their usual household expenses, with 5.5% have slight or no confidence in paying next month’s rent or mortgage on time. There is good new on the horizon. The National Association of REALTORS® in our Housing and Economic Forecast are projecting mortgage rates to remain competitively low through 2021 at roughly 3% nationally for a 30-year fixed mortgage. With unemployment still high at 6.5% - but much lower than the Covid era in 2020 of 8.1%. 21 “A Summary of Population Forecasts and Origins of Recent Newcomers to Spokane County” D. Patrick Jones, PhD – Executive Director of EWU’s Institute for Public Policy & Economic Analysis W Spokane and Spokane County have grown consistently over the past 20 years, but something began to happen in 2018 that saw these growth rates begin to change. In Spokane County, since 2010 we have seen about a 1% growth, adding about 51,000 residents. Yet, that growth rate started to increase in 2018 to 1.5%. In the City of Spokane, the annual compounded growth rate since 20010 has been about .7%, or roughly 15,000 residents. With a similar increase happening since 2018 increasing to a 1% growth rate. Surprisingly, the average household size in Spokane is about 2.25 residents per home compared to Spokane County at 2.4. This is a trend that looks like its going to continue that way. These numbers are reflected in the 2017 Growth Management Act forecast that show us growing at a steady rate to a population Spokane County wide of about 564,538. Historically, these estimates have been slightly underreported by a factor of about 0.1%. 22 One trend that continues is that Spokane continues to shrink its population when compared to that of the County. Where has this growth occurred? 23 The largest increase has been in Airway Heights with over 5% growth since 2010, and Liberty Lake of about 4.25%. I believe we will see a replication of this pattern of growth that will continue in the decade ahead. What will be driving this will be the housing preferences of in-migration families along with the ability of the City of Spokane to foster urban businesses such as the technology sector, professional and scientific services. Additionally, Spokane will need to address its municipal regulations to adapt to these changing patterns or else risk losing these arrivals to those that better address their needs. 24 In trying to make a stronger forecast for population growth specific to the City of Spokane (COS), there are three separate models to consider that will each represent a different picture. The first, is a model based on the historical share of Spokane County’s population (an average growth rate) The second is a compounded annual growth rate of the county, and finally the City of Spokane’s 2020 share of the county’s population. Using these approaches, we see a range of population gain in the next ten years of between 15,716 and 23,103 people – with a total population growth by 2030 of between 239,316 and 246,703 people. While the growth projected gain for Spokane County would be an additional 90,000 people by 2030. The challenge becomes one for us to answer: “How much do we want to grow?” While these are only 1 to 3 percent growth numbers, each represents its own set of consequences. Based on these projections we see the overall need for housing units in the City of Spokane to add an additional 8,420 homes in the next 9 years. The housing need for these populations are different for owner- occupied versus those who are renting, with the average household size about 2.33 for homeowners. 25 Some demand numbers for housing units over the next decade in City of Spokane •-occupied and renter-occupied (55%/45%) were to hold in 2030, then… –~ 4,631 single family homes needed between now and 2030, or 460/year –~3,790 apartment units needed, or 379/year •, forecast is correct, because: –The current market in the City doesn’t have an adequate supply –The trend in COS household size is showing smaller averages –Countervailing trend: If the current homeowner versus renter ratios stays the same (55% vs 45%) this projection equates to a need of 4,631 single family homes in the City of Spokane, and 3,790 apartment units needed by 2030. These numbers are likely to be conservative because they are making a few assumptions: Spokane already is suffering from an adequate supply of homes. The trend in the City of Spokane is to show smaller averages than the county. The City of Spokane’s share of the population continues to trend down (slowly) We should note that the trend of new families to Spokane really began to increase with a peak of 11,454 people in 2018 and continuing through 2020 with 8.412. This number represents driver license surrenders we saw with those new here that obtained a local driver’s license. (Washington’s DOL recognizes that drivers from Washington State may not be a quick to surrender in-state licenses) We should see these new families reflected in the upcoming estimates by the OFM for population in April of 2021, along with an actual count being developed from the 2020 US Census report. 26 Where are these new visitors coming from? Most are coming from California, Idaho, and Oregon. With Arizona, Montana and Texas following. This represents roughly three-quarters of all new families. Within the state King County is first, following by Stevens, Snohomish, and Pierce County. Additionally, we see 2017-2018 IRS data supporting the notion that a large portion of our incoming population is coming from outside Washington State. 27 “The Social Impacts of Low Housing Stock in Spokane” Vange M. Ocasio Hocheimer, PhD – Associate Professor of Economic, Whitworth University “A our Housing as a Social Determinant of Health combines several well-established standards seen in the literature. Specifically defined these are “the conditions that shape the health of individuals.” Housing specifically is among the key social and economic conditions necessary for the individual and our communities. Here in Spokane, we are seeing the effects of a lack of housing as it impacts increasing rates of illness, mental health, and homelessness. Among the biggest factors is the increase in those spending more of their income for shelter costs. This increasing cost burden (more than 30% of their income on housing) is that over 48% of renters now in Spokane County, much higher than in the state. Those considered to be “severely burdened,” spending more than 50% of their income on housing, now tops 23% in Spokane County. 28 Conventional wisdom shows that Risky Behaviors, leads to Drug use, which leads to Academic Underachievement – and unemployment, which leads to Homelessness. But the data in Spokane is now clear. 29 The social impact of a lack of available housing in Spokane has, in many cases reversed this process. Homelessness often happens first. Often from some traumatic event. Resulting in a completely different model for many local individuals, with a host of negative social impacts. We see this specifically with the student population where we have seen a 25% increase in children impacted by some level of homelessness since 2007. These impacts are greater in Spokane County than across the state and the US. The Spokane School District has identified 1,644 students that are affected by a lack of housing. With increases seen in the elementary schools, along with higher rates for High school. Many suffer from a wide range of housing experiences, including doubling up in beds, temporary housing in motels or shelters and 7% not having any shelter at all. This represents about 4.7% of students in the Spokane School District. These students across the board suffer academically. Lower attendance rates, changing schools, lower English and Mathematic proficiencies. and a lower graduation success rate. 30 Mead School District has seen a comparable number, about 4.6% of all students with similar academic challenges. But Mead is also seeing a lower graduation rate – only 65% of housing impacted students compared to 91% graduation rates. Other impacts to Spokane’s youth include higher rates of suicide and greater use of drugs. Rates among Blacks and those who identify as 2 or more races is also on the increase. It is of note that these groups are disproportionally seen have having housing issues greater than White, Asian, and Hispanic families in Spokane County. 31 While the rates of serious mental illness have grown exponentially in Spokane County since 2015, nearly doubling that of the rest of Washington State. With the largest group being individuals 18 years of age and younger. In summation, it is clear the pathway to improved health and wellbeing for all people in our community begins with housing. Renters that become homeowners have a greater sense of “home” shown to greatly reduce the stress of uncertainty, increases sense of neighborhood and well-being, increases available social interactions that brings a level of social support, and helps reduce financial stress. 32 “Housing Needs Assessment Survey for Spokane Spring 2020” Sara Stephenson – American Strategies - American Strategies is a national polling firm specializing in housing issues. We did a survey in Spokane back in April of 2020. Our survey pool was over 500 voters in Spokane. This data has been weighted to match the demographics of Spokane. There is a perception of housing costs in Spokane that costs are too high. Half of voters (48% buying a home) say the cost to buy is too high, compared to over 2/3’s who believe rents are too high. 2/3 of Spokane Voters Say the Cost of Rent is Too High; Almost Half Believe the Cost to Buy a House is too High Cost of Housing And Rentals 80% +41 67% 60% +0 48%48% 40% 26% 20% 0% Cost to buy a houseCost to rent an apartment Too highAbout right Q.11 Generally speaking, wouldyou say that the cost to buy a house in Spokane is (ROTATE FIRST TO LAST AND LAST TO FIRST) too high, about right, or too low? Q.12 And would you say that the cost to rent an apartment in Spokane is (ROTATE FIRST TO LAST AND LAST TO FIRST) too high, about right, or too low? When this survey was conducted at the beginning stages of the Covid crisis, we saw that Spokane residents were already feeling the economic effects of rising housing costs. 40% reported that housing was putting either a severe or slight strain on their monthly budgets. 33 Northeast Residents, Younger Voters, and Renters More Likely to Feel Financial Strain of Rent or Mortgage Financial Strain of Your Rent/Mortgage by Region, Age and Homeownership A slight strain Total 14%25%39% Northeast 26%28%54% East Central 19%22%41% Northwest 14%26%40% Far NW 12%21%33% South 8%20%28% West Central 7%33%40% 18-34 16%31%47% 35-49 18%33%51% 50-64 15%19%34% 65+8%16%24% Rent 27%26%53% Own 7%23%30% Q.19 And, prior to the coronavirus pandemic, rent or mortgage each month? Was it (ROTATE FIRST TO LAST AND LAST TO FIRST) , a slight strain, not much of a strain, or no strain at all? The data is clear that the strain is being felt more geographically, specifically to renters in the Northeast, and the East and West Central Neighborhoods. These effects are also seen more with voters who are 35-49 years of age. Those with Lower Income, , and People of Color Are More Likely to Report Financial Strain Financial Strain of Your Rent/, Race and Income A slight strain Total 14%25%39% High school or less 22%22%44% Post high school 17%30%47% 4-year college graduate 9%24%33% Post graduate 6%20%26% People of Color 29%23%52% White 11%25%36% Less than $50k 23%28%51% $50k-$100k 10%26%36% More than $100k 5%16%21% Q.19 And, prior to the coronavirus pandemic, rent or mortgage each month? Was it (ROTATE FIRST TO LAST AND LAST TO FIRST) , a slight strain, not much of a strain, or no strain at all? 34 When we break down the data even further, we find significant differences with those who are of lower income, people of color and lower levels of education are feeling a greater financial strain. And remember, these numbers were done before the full effects of Covid were being felt. Were this survey to be repeated, we would see these numbers with even higher gaps between these groups. 1/3 of Spokane Voters Would Prefer to Move to a New Home M; Preference for Future Housing by Home Ownership 80% 78% 60% 60% 51% 40% 32% 29% 20% 18% 16% 2% 10% 0% All votersRentersHomeowners Buy a new home or condo Move to a new apartment Q.22 As you think ahead a few years, would you like to (ROTATE) , buy a new home or condo, or move to a new apartment? Surprisingly, one in three voters would prefer to move to a new home. We saw the greatest need among renters, with 51% telling us they are actively looking to buy a new home or condo. One of the key reasons we heard was that finding a home to buy is a serious challenge. Also, one in five people said they are looking to buy a new home. Non-White and Younger Residents Are More Likely to Want to Buy a New Home Percent Who Would Like to Buy a New Home in the Next Few Years Total 29% Non-white 55% Renters 51% Non-college under 50 47% Current Residence 18-34 45% 60% Women under 50 45% Residence length < 5 years 44% Men under 50 38% Post high school 38% Buy a new home or condo Q.22 As you think ahead a few years, would you like to (ROTATE) , buy a new home or condo, or move to a new apartment? 35 Of those wanting to buy, we found a significant higher number of non-white and younger residents wanting to purchase a home but are still in rental units. Across all of these groups you can clearly see a pent-up demand reflected for more housing. What type of policies would Spokane voters support for the building of more homes to address the lack of inventory and to lower the costs of homes? We saw broad consensus for providing incentives to developers, and for requiring set asides below market prices for housing, along with expanding zoning regulations to allow more alternative housing options like carriage homes, accessory dwelling units and tiny homes, along with more multi-family options like townhomes, duplexes, or apartment buildings. Many of these options are not currently available in Spokane. You should recognize that of the surveys we have done nationwide, we rarely see such levels of support for developer incentives like we see here in Spokane. This survey shows that voters in Spokane clearly want more options, are actively seeking opportunities, are feeling burdened by costs, and are willing to support policies that would foster these changes. 36 “The Shifting Marketplace: How Spokane Lost Market Share To Kootenai County.” Jim Frank – Founder/Developer – Greenstone Homes - I have been a home builder in this market for almost 35 years. And we’ve seen key changes in this market over the past 10 years, particularly with a significant market share growth change between Spokane and Kootenai County. If you look at 2011, there were around 172 new home sales in Kootenai, about 25% of the regional market shared with Spokane. By 2020, the Kootenai County market closed over 1000 homes and for the first time exceeded 50% of the regional housing market. This graphic shows the consistent trend over the past 10 years. This is data we collect on closings that lag permits by about one year. Most of the losses in Spokane County has been seen primarily within the City of Spokane. There are several key reasons we are seeing this shifting housing market. 37 While it is true that land costs are lower and more abundant in Idaho, we are also seeing critical reasons that Spokane is becoming less desirable for housing development. The urban growth boundaries in Spokane have become very restrictive. This is not something that is in place in Kootenai county. Coeur d’ Alene, Post Falls, Rathdrum and Hayden have been able to annex boundary lands that have effectively expanded their growth opportunities. Idaho has done a great job marketing their regional quality of life. It’s clear there are higher migration patterns into Kootenai County then there are into Spokane County based on our data. Virtually every home we sell in Kootenai County has more offers than we see in Spokane. While Spokane County is working to implement more urban infill strategies, Spokane’s urban village corridor concept has never been implemented with development regulations that allow this to occur. Instead, what is happening in Spokane is we are building houses on large lots, and we build large apartment complexes, and we build nothing in between. We simply do not have the development regulations that allow this to happen. Idaho does. In fact, they offer different levels of condominium opportunities alone in the Coeur d’ Alene area because of this flexibility in development opportunities. There has not been a condominium development built in Spokane since the State’s condominium reform in 2009. This removed a critical step in the affordable housing ladder. We need to allow a wider range of uses and flexibility in housing projects. We are also seeing the impacts of out-of-town buyers to our region starting in the last four years. in Spokane, that number reached 44% in 2020, up from about 32% in 2017. 38 To put that in a market perspective, we’re seeing 59% of out-of-town buyers purchasing homes in Kootenai County – compared to 30% in Spokane County in 2020. A lot of that is due to the greater range of product, and more housing stock available, and the impact of Kootenai marketing the quality of life, such as the advantages of being near the lakes, rivers, and smaller town America. Covid has only accelerated that need. The real lesson here is the importance of having middle-income housing, the importance of having housing diversity, the importance of having integrated neighborhoods with a wide range of housing types along with a wide range of economic opportunities and neighborhoods. It’s going to take a dramatic change in our development regulations at both the state and local levels to allow that to happen. 39 “The Missing Housing Supply for Low Income Families” Ben Stuckart – Spokane Low Income Housing Consortium “ First, a couple of definitions that define what Low-Income Housing means 1. Can you afford it if you make 80% of the median income or below? By afford it we mean you should be spending 35% or less of your monthly income on rent or a mortgage. This can include market rate housing at the lower end 2. Homes and apartments for rent that accept vouchers can be considered low-income 3. Homes and apartments that were built with government subsidy should be considered low-income. Once they use build with these funds they are required to keep rents low enough to be considered low-income. Spokane County has about 5000 subsidized units representing less than 5% of the units available in total in the county. If we are lucky another 3-4,000 accept vouchers. Successful cities have over 15-20% of their housing stock subsidized to take care of those on the edge of poverty or in poverty. Wait lists alone right now for the 12 largest managers/owners of subsidized housing could fill 2000 units tomorrow. A wait list for Spokane Housing Ventures today is typically 4 years. Other agencies experience waiting lists between 1 and 4 years. We do not have the housing supply to move people from the streets into housing. Government Funds to build low-income housing have been decreasing over time, not just not keeping up with inflation but decreasing. HOME funds are a popular federal fund to use. Amounts fluctuate but this one statistic is telling: In 1992 the City of Spokane received $1.3 million in HOME funds to build more housing. In 2018 the City of Spokane received $1.3 million in HOME funds to build low-income housing. The Housing Trust Fund (State) just returned to 2008 levels in 2020. No adjustment for inflation. State and Federal funding sources have not kept up with demand. The City of Spokane recently passed HB1590 which puts local sales tax dollars into building more low-income housing. The $6 million this will generate is a good start but we need the County and the Valley to also figure out a way to dedicate dollars to low-income housing. Market Rate Housing is just as important as the subsidized housing. A 2018 UC Berkeley study discussed how a new high end home allowed 6 different families to move up and free market rate housing at levels below the new home. 40 We have created our own issues in housing: Using environmental standards like the States Evergreen standards to increase costs so now a non- profit who builds low-income housing and uses State dollars spends over 50% square foot than a market rate housing developer building the same unit. The Growth Management Act said donot spread out BUT assumed cities would implement their comprehensive plans. The City of Spokane has a Centers and Corridors Strategy BUT has never taken the step to create density around the 28 Centers and Corridors. This is a byproductof NIMBYism and strong neighborhood councils that favor the status quo over any change to current single-familyzones. The entire system is setup to continue the racial inequities of the last 100 years. Further entrenching those in poverty in the same neighborhoods with no ability to buy a home and create wealth. The Federal and State say if you use any of their funds to build low-income housing in must be in a census tract with high poverty. Thus you never have mixed income neighborhoods and they are always in the same neighborhoods. The City perpetuates this by never spreading the multi-family zones to new neighborhoods and concentrating the density in west central and east central. We have to build more low-income housing. But we must also build more market rate housing, or the problem will continue to snowball. 41 “Broken Pledges Under the Growth Management Act.” Al French – Spokane County Commissioner I have been closely involved in housing development and policies going back to 1995 when I first served on the City of Spokane’s Planning Commission. I served eight years on the Spokane City Council and am now in my tenth year as a Spokane County Commissioner. So, I have had to deal with the State’s Growth Management Act (GMA) for several decades (enacted in 1990). There were promises made 26 years ago when we adopted the comp plan under the GMA that just have never been realized. By design, this was aimed at moving more development and retail opportunities into the urban areas which lowered each county’s ability to provide services from the correlating tax base. We have also seen this act now becoming a political tool, with efforts to add elements such as for climate change, and greenhouse gas reduction, but without any funding to help counties implement such strategies. These costs are passed on to consumers raising the costs of housing. One example is the recent changes in building codes that increase efficiency (by one or two percent) but add $15 to $20 thousand to the cost of a new home. Tragically, this prices many families from buying these homes. One key benefit of adding more infill to our urban areas is supposed to be to lower the cost of housing. Unfortunately, by restricting the access to lands, the simple rule of “supply and demand” results in land costs being artificially pushed up. We are seeing new jobs coming to such as the Spokane Valley, and Airway Heights without the equal number of workforce housing opportunities. As such, we are seeing a greater demand on our area roadways. Interstate 90 is suffering from traffic backups and delays seen in large metropolitan regions. In the county, we are working to remove some of these barriers to affordable homes by allowing for more homes to be built on smaller lots. But this is a short-term fix until the market begins to adjust. Home ownership is one of the hallmarks of this country, and a primary wealth-builder for many families. Because of restrictive condo legislation, we are seeing multi-family opportunities restricted to apartments or townhouses. When you restrict land, and limit housing types, you create a housing crisis that we are currently in. Increased density will also create more retail business opportunities closer to where people live. This can reduce travel times – something that is not seen in this state. Spokane’s comp plan is predicated on a strategy of centers and corridor infill next to transportation corridors. Unfortunately, the City of Spokane has yet to develop strategies to implement this plan. In fact, there has not been a single development within this strategy as it was envisioned in the plan since it was first adopted 21-years ago. Kendall Yards was NOT in one of these areas. Yet stands as a perfect example of how infill strategies can be possible. It was developed as a “planned unit development” – and not part of one of the recognized centers. 42 I agree with former City Council member Ben Stuckart in that the city has failed to implement its urban development regulations to develop any urbanized areas. This strategy does not work. As a result, we have a lot of undeveloped land and missed housing opportunities. We need to change that. If we are committed to a plan, let’s implement it. If not, then let’s change it. But right now, what we are doing is not working. (Editor’s note: Commissioner French has called on the City of Spokane to give up some of its GMA housing allotments for use in Airway Heights and Spokane Valley, with estimates the city has underbuilt GMA targets by 34,000 housing units it had originally promised by the year 2026.) 43 Conclusions and Findings The data is clear. A bad as Spokane’s housing crisis stands, it may just be thebeginning. Every expert we convened shared the same concern over policy and practices that are hampering housing development opportunities. By failing to build the estimated 31,920 homes, the Spokane Region may have missed out on lost economic opportunities, lost tax revenues and increasing environmental hazards from residents moving farther and farther away from employment centers. Using the numbers provided by our experts, Spokane has missed out on: $6-billion dollars in wages and employment since 2010 $1.1-billion dollars in immediate and ongoing tax revenues Additionally, each buyer who moves into Kootenai County and commutes to Spokane for work, shopping or school adds an additional 4.6 metric tons of carbon dioxide to the air. (source: EPA) Already, the census bureau estimates some 10,000 workers commute from Northern Idaho every day to work in the Spokane region. Spokane’s housing market is lacking, and its changing. It has created hardships and suffering for many. We cannot fix this problem overnight. But we must get started. Understanding the true extent of the problem is just the first step. 44 CITY OF SPOKANE VALLEY Request for Council Action Meeting Date:May 18,2021 Department Director Approval: Check all that apply:consent old business new business public hearing informationadmin. reportpending legislationexecutive session AGENDA ITEM TITLE:Events, Activities and Recreation in Phase 3 Covid-19 GOVERNING LEGISLATION:N/A. PREVIOUS COUNCIL ACTION TAKEN:City Council approved the 2021Parks and Recreation Department budget on December 8, 2020.June 16, 2020 Admin Report: COVID-19 Impact on Parks and Recreation Summer Programs BACKGROUND:No one could have predicted COVID-19 or its impact on the State of Washington. On March 17, 2020 the City Councildeclared an emergency through passage of Resolution 20-005 which authorized the City Manager to close certain City facilities, including the CenterPlace Regional Event Center. In May of 2020 the Governor announced Washington’s Phased Approach plan and on May 22, Phase 2 had begunfor Spokane County. Anticipating a possible Phase 3 last year, the Parks and Recreation Department provided an update toCouncil on June 16, 2020 about potential revised recreation programming should the County reachPhase 3. Ultimately the Department was not able to offer its traditional arrayof Special Event Permits, FacilityReservations, or RecreationPrograms in 2020. Alimited number of “essential trainings” were able to resume inside CenterPlace in the fall of 2020. Fast-forward to January 11, 2021, the Governor replaced Washington’s original Phased Approach Plan with the new “Healthy Washington Roadmap to Recovery” Plan with a regional approach to reopening consisting of 2 phases withall regions beginning in Phase 1. On February 14, 2021,Spokane County moved into Phase 2 of the new Roadmap to Recovery. Most recently, on March 22, 2021,the Governor added a Phase 3 to the Roadmap to Recoveryand began providing specific guidelines for various activities in Phase 3. Counties are individually evaluated every three weeks.Spokane County is currently in Phase 3 and thenextevaluationis scheduled for May18, 2021. The Spokane Regional Health District’s (SRHD)COVID-19 Guidance Event Planning Flowchartis a comprehensive document with live links to assist citizens, event planners and businesses. TheReopening Guidance for Businesses and Workerspage on the Governor’s website provides specific requirements for variouskindsof activities.Parks and Recreation staff have been participating in regular meetings of the SRHD’s Events and Venues Workgroup and the Washington Festivals and Events Association (WFEA).While CenterPlace still remains closed to the general public, a broader range of activities allowable under the Governor’s guidelines have begun to take place inside the facility and Parks staff have resumed processing Facility Use Reservations and Special Event Applications. Staff will be presenting anoverview of Events, Activities and Recreation Programs under the current and ever-evolving Covid-19 guidelines in 2021. OPTIONS:Council discussion. RECOMMENDED ACTION OR MOTION:No recommended action at this time. BUDGET/FINANCIAL IMPACTS:Anticipated expenditures will be within our existing 2021Parks and Recreation Department budget. STAFF CONTACT:John Bottelli,Parks,Recreation& Facilities Director;Carol Carter, CenterPlace Coordinator; Tina Gregerson, Recreation Coordinator; Patty Bischoff, Administrative Assistant. ATTACHMENTS:PowerPoint Presentation DRAFT ADVANCE AGENDA as of May 13, 2021; 8:30 a.m. Please note this is a work in progress; items are tentative To: Council & Staff From: City Clerk, by direction of City Manager Re: Draft Schedule for Upcoming Council Meetings May 25, 2021, Formal Meeting, 6:00 p.m. \[due Tue May 18\] 1. Consent Agenda (claims, payroll, minutes) (5 minutes) 2. Second Reading Ordinance 21-005 Title 24 CTA (2020-0004) Jenny Nickerson (no public comment) (10 min) 3. Second Reading Ordinance 21-006 Amending 2021 Budget Chelsie Taylor (no public comment) (10 minutes) 4. Motion Consideration, Mayoral Appointment, Spokane Housing Authority Mayor Wick (5 minutes) 5. Motion Consideration: Bid Award, Argonne/Montgomery Intersection Improvement-B. Helbig (5 minutes) 6. Admin Report: Potential Grant Opportunity, Pines/BNSF GSP Adam Jackson (10 minutes) 7. Admin Report: Urban Growth Area Update Mike Basinger (15 minutes) 8. Admin Report: Code Enforcement Program Jenny Nickerson (20 minutes) 9. Advance Agenda Mayor Wick (5 minutes) 10. Info Only: Department Monthly Reports \[*estimated meeting: 85 mins\] June 1, Study Session, 6:00 p.m. \[due Tue May 25\] ACTION ITEMS: 1. Resolution 21-001 Adopting Housing Action Plan Chaz Bates (no public comment) (10 minutes) 2. Motion Consideration, Bid Award, 0317 Appleway-Stormwater Bill Helbig (5 minutes) 3. Motion Consideration: Potential Grant Opportunity: Pines/BNSF GSP- Adam Jackson (5 minutes) NON-ACTION ITEMS: 4. End of Legislative Session Update Briahna Murray (30 minutes) 5. Shoreline Master Plan - Chaz Bates (15 minutes) 6 Aquatics Update John Bottelli (10 minutes) 7. Capital Improvement Program Gloria Mantz (15 minutes) 8. Bridge Program Gloria Mantz (10 minutes) 9. Advance Agenda Mayor Wick (5 minutes) \[*estimated meeting: 105 mins\] June 8, 2021, Formal Meeting, 6:00 p.m. \[due Tue June 1\] 1. PUBLIC HEARING: 2022-2027 Six Year Transportation Improvement Program Adam Jackson (10 min) 2. Resolution 21-002 Adopting 2022-2027 Six Year TIP Adam Jackson (no public comment) (5 minutes) 3. Consent Agenda (claims, payroll, minutes) (5 minutes) 4. First Reading Ordinance 21-007 Adopting Shoreline Master Plan Chaz Bates (10 minutes) 5. Admin Report: Boys & Girls Club Richard Hanlin (20 minutes) 6. Admin Report: Contamination Reduction and Outreach Plan (CROP) Henry Allen, M.Koudelka (20 min) 7. Admin Report: Advance Agenda Mayor Wick (5 minutes) \[*estimated meeting: 75 mins\] June 15, 2021, Budget Workshop 2022 Budget 8:30 am to approximately 3:00 pm June 15, Study Session, 6:00 p.m. Meeting Cancelled AWC Conference: June 22-25 live and recorded webinars June 22, 2021, Formal Meeting, 6:00 p.m. \[due Tue June 15\] 1. Consent Agenda (claims, payroll, minutes) (5 minutes) 2. Second Reading Ordinance 21-007 Adopting Shoreline Master Plan Chaz Bates (10 minutes) 3. Resolution 21-003 Adopting Contamination Reduction & Outreach Plan (CROP) H.Allen, M.Koudelka (10 min) 4. Admin Report: Advance Agenda Mayor Wick (5 minutes) 5. Info Only: Department Monthly Reports \[*estimated meeting: 30 mins\] Draft Advance Agenda 5/13/2021 10:16:02 AM Page 1 of 2 June 29, 2021, Study Session, 6:00 p.m. \[due Tue June 22\] 1. Advance Agenda Mayor Wick (5 minutes) July 6, 2021, Study Session, 6:00 p.m. \[due Tue June 29\] Proclamation: July is Parks & Recreation Month 1. Advance Agenda Mayor Wick (5 minutes) July 13, 2021, Formal Meeting, 6:00 p.m. \[due Tue July 6\] 1. Consent Agenda (claims, payroll, minutes) (5 minutes) 2. Admin Report: Council Goals & Priorities for Use of Lodging Tax Chelsie Taylor (10 minutes) 3. Admin Report: Advance Agenda Mayor Wick (5 minutes) July 20, 2021, Study Session, 6:00 p.m. \[due Tue July 13\] 1. Advance Agenda Mayor Wick (5 minutes) Spokane Valley State of the City: July 21, 2021 July 27, 2021, Formal Meeting, 6:00 p.m. \[due Tue July 20\] 1. Consent Agenda (claims, payroll, minutes) (5 minutes) 2. Motion Consideration: Council Goals & Priorities for Use of Lodging Tax Chelsie Taylor (10 minutes) 3. Admin Report: Advance Agenda Mayor Wick (5 minutes) 4. Info Only: Department Monthly Reports Aug 3, 2021, Study Session, 6:00 p.m. \[due Tue July 27\] 1. Advance Agenda Mayor Wick (5 minutes) Aug 10, 2021, Formal Meeting, 6:00 p.m. \[due Tue Aug 3\] 1. Consent Agenda (claims, payroll, minutes) (5 minutes) 2. Admin Report: Advance Agenda Mayor Wick (5 minutes) Aug 17, 2021, Study Session, 6:00 p.m. \[due Tue Aug 10\] 1. Council 2022 Budget Goals Chelsie Taylor (15 minutes) 2. Advance Agenda Mayor Wick (5 minutes) Aug 24, 2021, Formal Meeting, 6:00 p.m. \[due Tue Aug 17\] 1. Consent Agenda (claims, payroll, minutes) (5 minutes) 2. Admin Report: 2022 Budget-Estimated Revenues & Expenditures Chelsie Taylor (10 minutes) 3. Admin Report: Advance Agenda Mayor Wick (5 minutes) 4. Info Only: Department Monthly Reports Aug 31, 2021, Study Session, 6:00 p.m. \[due Tue Aug 24\] 1. Advance Agenda Mayor Wick (5 minutes) *time for public or Council comments not included OTHER PENDING AND/OR UPCOMING ISSUES/MEETINGS: Appleway Trail Amenities Residency Arts Council Sculpture Presentations Ridgemont Area Traffic Artwork & Metal Boxes St. Illumination (owners, cost, location) Consolidated Homeless Grant St. O&M Pavement Preservation Core Beliefs Resolution TPA Mirabeau Park Forestry Mgmt. Union Gospel Mission re Homelessness No Parking Zones Vehicle Wgt Infrastructure Impact Park Lighting Water Districts & Green Space PFD Presentation Way Finding Signs CITY OF SPOKANE VALLEY Request for Council Action Meeting Date:May 18, 2021Department Director Approval: Check all that apply:consentold businessnew businesspublic hearing informationadmin. reportpending legislationexecutive session AGENDA ITEM TITLE:Information only -Spokane Regional Law and Justice Council (SRLJC) monthly meeting report for May, 2021. GOVERNING LEGISLATION:RCW 72.09.300. PREVIOUS COUNCIL ACTION TAKEN:May 4, 2021, Councilissuance of a letter to the Board of County Commissioners supporting two committee approach if changes are to be made to the existing SRLJC structure and membership. BACKGROUND:The SRLJC was formed in early 2014 for various reasons,including to meet statutory requirements, and to provide a forum for regional entities to meet and discuss the criminal justice system and how it could be improved. The City of Spokane Valley was not given a designated position on the SRLJC, and instead shares one seat with the other municipalities in Spokane County (with the exception of the City of Spokane, which has fourrepresentatives).Then-City Manager Mike Jackson sent letters to all of the other jurisdictions to ask whether they had any interestin filling the representative position. After not receiving any comments or suggestions, then-City Manager Jackson appointed City Attorney Cary Driskell as the representative of the County’s municipalities (minus Spokane), a position he has filled since early 2015.The appointment was based on his knowledge of the criminal justice system. The SRLJC generally meets over lunch on the second Wednesday of each month, although meetings are cancelled occasionally if there are not sufficient agenda items, or if SRLJC members are likely to be absent. After each meeting, Mr. Driskell sends a summary of the meeting events and discussions to each of the represented jurisdictions, which goesto the Mayor, City Manager/Administrator, or City Clerk as requested by the entity. At the May 4, Council meeting, a Spokane Valley Councilmember noted that they were unclear about what has been happening at the monthly SRLJC meetings.Given this, City Manager Calhoun determined that a copy of the monthly meeting summary wouldbe put into the Council packet as an informational item until such time as Council requested otherwise. This would provide additional guidance to Council on what the current topic issues are for the SRLJC. If a summary report is not provided for a particular month, Council should assume a meeting was not held. If there is something mentioned in the report that Council would like additional information on, staff can provide it. OPTIONS:Not applicable. RECOMMENDED ACTION OR MOTION:Not applicable. BUDGET/FINANCIAL IMPACTS:Not applicable. STAFF CONTACT:Cary Driskell, City Attorney. ___________________________________________________________________________ ATTACHMENTS:SRLJC May 2021 meeting summary report. OFFICE OFTHECITY ATTORNEY CARY P. DRISKELL -CITY ATTORNEY 10210EastSprague AvenueSpokane Valley,WA 99206 509.720.5105Fax: 509.720.5095cityattorney@spokanevalley.org May 12, 2021 http://www.spokanecounty.org/872/Spokane-Regional-Law-Justice-Council To:Represented communities in Spokane County From:Cary Driskell, Spokane Valley City Attorney, acting in representative capacityfor municipal legislative entities (except Spokane)on Spokane Regional Law & Justice Council. Re:Monthly SRLJC meeting on May 12, 2021. 1.Welcome/introductions.TheSRLJC meeting washeld by Zoom. 2.Approval of the April 14, 2021 meeting Minutes.The minutes from April 14, 2021 were approved. 3.Discussion of SRLJC organizational structure. This was a discussion continued from the March and Aprilmeetings, and focused on the proposed resolution by Spokane County Prosecutor Larry Haskell that would reduce the SRLJC from its current size and duties to those set forth in RCW 72.09.300. A copy of a draft resolution for proposed adoption by the Board of County Commissioners is attached as well. Among the changes would be to have one representative for all cities and towns in Spokane County instead of the current four, and would remove the Public Defender, along with other representatives. At the April meeting,a motion was made and seconded to refer to the Strategic Planning Committee for discussion and recommendation of options for a new or revised committee structure in lieu of the SRLJC, and to provide for potential alternatives to Prosecutor Haskell’s proposal.Strategic Planning held a Special Meeting on April 28 to discussion options, and request that the Chair and Vice-Chair bring back a recommendation based on those discussions. Atthe May 10 Regular Meeting, Strategic Planningapproved a recommendation to the SRLJC. There was considerable discussion at the May 12 SRLJCmeeting about this issue,after which the SRLJC voted 11-7 to approve the recommendation and forward it to the BoCC.(A copy of the recommendation is attached for review)This will only be a recommendation, but represents an opinion of a majority of the SRLJC members that there is value in continuing to have a forum to discuss these criminal justice issues. 4.Update on Mental Health Crisis Stabilization Facility–Pioneer Behavioral Health, which has a contract with Spokane County to operate this new facility, gave an update on how they expect the facility to operate. The facility is anticipatedto open in June 2021. Criminal Justice Administrator Maggie Yates said the PowerPoint presentation from Pioneer will be available soon on the SRLJC website for more information. Information was also presented on the behavioral health co-deployed teams (team of one law enforcement officer and a mental health professional), and how they are being deployed to reduce Page 1of 2 use-of-force situations to keep both the public and officers safer. These interactions also provide an excellent opportunity to talk with those in need, and to work to connect them with needed services.There are currently eight co-deployed teams in the region, andPioneer statedthere is a need for more teams. There are more funds available this year for potential expansion of the program, and Pioneer is in the process of applying for additional funding for this purpose. Undersheriff Kittilstved echoed the value of the program,agreedthat additional teams are needed, and also stated that the region needs to think about how we will respond if the grant funding goes away, urging the leaders to commit to finding a way to keep this program going. 5.Adjourn. *As previously noted,you can sign up for the SRLJC NewsFlash by clicking on the following link http://www.spokanecounty.org/list.aspxand scrolling down to locate the Spokane Regional Law and Justice Newsunder “News Flash” to sign upfor notifications and updates. You can also see “Latest News” at: www.spokanecounty.org/srljc Page 2of 2 NO.______________ BEFORE THE BOARD OF COUNTY COMMISSIONERS OF SPOKANE COUNTY, WASHINGTON IN THE MATTER OF MODIFYING ) SPOKANE COUNTY RESOLUTION ) NOS. 14-0392, 15-0849, 17-0259, 18-0209)R E S O L U T I O N and 18-0912WHICH RE-ESTABLISHED ) THE SPOKANE COUNTY LAW AND ) JUSTICE COUNCIL ) WHEREAS, pursuant to the provisions of the RCW 36.32.120(6), the Board of County Commissioners of Spokane County, Washington (sometimes hereinafterreferred to as the “Board” or “Board of County Commissioners”) has the care of County property and the management of County funds and business; and WHEREAS,pursuant to RCW 72.09.300,every county legislative authority shallby resolutionorordinance establish a local law and justice council; and WHEREAS,pursuant to RCW 72.09.300(1), the county legislative authority shall determine the size and composition of the law and justice council, which shall include certain individualsin identified positions;and WHEREAS,in 2013 the Spokane Regional Criminal Justice Commission, consisting of the Honorable James Murphy (Retired), James McDevitt, and Phillip Wetzel, authored a document entitled “A BLUEPRINT FOR REFORM” which document was structured to allow an overview of the current criminal justice system operations, acknowledgment of work to date, followed by a set of recommendations for governance, reform and research; and WHEREAS,Recommendation 5.1(2) of A BLUEPRINT FOR REFORM provided as follows: Recommendation 5.1(2) Re-establish the Law and Justice Coordinating Committee and supporting workgroups ; and WHEREAS, pursuant to the provisions of RCW 36.32.120(6),RCW 72.09.300and Recommendation 5.1(2) of A BLUEPRINT FOR REFORM, the Board of County Commissioners re-established the Law and Justice Council under Spokane County Resolution No. 14-0392and further modified the composition/provisions of Resolution No. 14-0392 under Resolution Nos. 15- 0849, 17-0259, 18-0209 and 18-0912; and WHEREAS,pursuant to the provisions of Resolution No. 19-1347, the Board of County Commissioners reconvened the Spokane Regional Criminal Justice Commission to provide a Page 1of 8 status report on the recommendations set forth in A BLUEPRINT FOR REFORM; and WHEREAS, consistent with Resolution No. 19-1347, the Spokane Regional Criminal Justice Commission authoreda document entitled “THE BLUEPRINT FOR REFORM –STATUS REPORT (October 2020)”. The STATUS REPORT document addressed Recommendation 5.1(2) of A BLUEPRINT FOR REFORMas follows: 5.1(2) Re-establish the Law and Justice Coordinating Committee &Supporting Workgroups. The Spokane Regional Law & Justice Council (SRLJC) and its committees were reestablished shortly after the Blueprint’s publication. Since then, the Council has clarified that it is strictly an advisory body (consistent with RCW 72.09,300 and SRLJC bylaws) and cannot manage, direct, or implement initiatives. Although we commend the efforts of the SRLJC, the body has struggled to live up to its original charge due to the unwieldy number of participants, internal disagreement over the Council’s purpose and authority, and ongoing public scrutiny. As a result, local jurisdictions have established and disbanded a slew of other committees, task forces, and working groups over the past several years in order to manage and move projects forward.In many cases, such committees have been productive, but in other cases, they have thwarted centralized communication, planning, and public transparency. Moving forward, the CJC recommends shifting or replacing the SRLJC with a Criminal Justice Coordinating Committee, as endorsed by the National Institute of Corrections. Bottom Line: The SRLJC struggled to grow into an agile and effective working group necessary to catalyze change. County Commissioners and other officials should seriously consider replacing the SRLJC with a Criminal Justice Coordinating Committee. ; and WHEREAS, the Board of County Commissioners has considered the recommendation of the Spokane Regional Criminal Justice Commission with respect to replacing the SRLJC with a Criminal Justice Coordinating Committee as endorsed by the National Institute of Corrections. The Board recognizes that if they establishment of a CriminalJustice Coordinating Committee as endorsed by the National Institute of Corrections under a code county, such as Spokane County, such Coordinating Committee would only be able to provide recommendations to elected officials or political subdivisions involved in the criminal justice system. As such, instead of duplicating the efforts of the SRLJC by the creation of a Criminal Justice Coordinating Committee, the Board of County Commissioners believes that it is more appropriate to address the Regional Criminal Justice Commission’srecommendation regarding the “unwieldy number of participants” in the SRLJC byreducing membership is the SRLJC thus fostering a stronger approach to addressing the charge of the SRLJC. NOW, THEREFORE, BE IT RESOLVEDby the Board of County Commissioners of Spokane County, Washington, pursuant to the provisions of: Page 2of 8 (1)RCW 36.32.120(6), (2)RCW 72.09.300,and (3)“THE BLUEPRINT FOR REFORM –STATUS REPORT (October 2020)”-“5.1(2) Re-establish the Law and Justice Coordinating Committee & Supporting Workgroups” that the Board of County Commissioners does hereby modify Spokane County Resolution No. 14- 0392,as modified by Resolution Nos. 15-0849, 17-0259, 18-0209 and 18-0912as more particularly set forth in Attachment "A", attached hereto and incorporated herein by reference. The provisions of this Resolution shall supersede and replace Spokane County Resolution No. 14-0392 as modified by Resolution Nos. 15-0849, 17-0259, 18-0209 and 18-0912.All Committees and Workgroups established under the superseded and replaced Resolutions shall cease unless reestablished by the Board of County Commissioners upon its own action or the request of the Committee as provided for in Section 8 of Attachment “A”. BE IT FURTHER RESOLVEDby the Board of County Commissioners of Spokane County, Washington, that this Resolution shall be effective as of the date passed and adopted by the Board of County Commissioners. PASSED AND ADOPTEDthis ______ day of _______________, 2021. BOARD OF COUNTY COMMISSIONERS OF SPOKANE COUNTY, WASHINGTON ___________________________________ JOSH KERNS, Chair ATTEST:___________________________________ MARY L. KUNEY,Vice-Chair _____________________________________________________________ Ginna VasquezAL FRENCH, Commissioner Clerk of the Board Page 3of 8 ATTACHMENT “A” (Underlinedhighlighted language added, lined out highlighted language deleted.) Section 1:ESTABLISHMENT OFTHESPOKANE COUNTY LAW AND JUSTICE COUNCIL ANDADMINISTRATIVE COMMITTEE CRIMINAL JUSTICE COORDINATING COMMITTEE There is created a boardlocal law and justice council, to be known as the SpokaneCountyRegional Law and Justice Council,Criminal Justice Coordinating Committeehereinafter referred to as the “Council”“Committee”,which shall supersede and repeal all prior measures regarding bodies established pursuant to RCW 72.09.300. The CouncilCommitteeshall have the following compositionas(the 13 italicized members are required byRCW 72.09.300): a.Three (3)members of theSpokane CountyBoard of County Commissioners selected by the Board of County Commissioners; b.Spokane County Sheriff; c.A representative of Municipal Police Departments to be selected by the Municipal Police Departments; d.Spokane County Prosecutor; e.A representative of Municipal Prosecutors to be selected by the Municipal Prosecutors; f.City of Spokane Council Member to be selected by the Spokane City Council; g.Arepresentative of the City Legislative Authorities, other than the City of Spokane,to be selected by the City Legislative Authorities; h.A representative of Spokane County Superior Court to be selected by the Spokane County Superior Court; i.A representative of Spokane County Juvenile Courtto be selected by the Spokane County Superior Court; j.A representative of Spokane County District Court to be selected by the Spokane County District Court; k.A representative of Municipal Courts to be selected by the Municipal Courts; l.Spokane County Jail Administrator (Detention Services Director); m.Spokane County Superior Court Clerk; n.Spokane County Risk Manager;and o.Secretary of Corrections.; p.Spokane County Public Defender; q.City of Spokane Mayor; r.Spokane County Pre-Trial Services Director; Page 4of 8 s.A representative of the Spokane Municipal Court to be selected by the Spokane Municipal Court t.City of Spokane Chief of Police; u.Four (4) at-large members representing the general population, to be selected by the Board of County Commissioners. The Council Strategic Planning Workgroupwill be responsible for generating an updated list of regional criminal justice reform priorities every time a vacancy occurs in anyone of the four (4) at-large members.This updated list will be shared with the Board of County Commissioners prior to posting any vacancies in anyone of the four (4) at-large memberpositions; and v.Such other member(s) as the Board of County Commissioners may hereinafter determine to be beneficial. Any elected member of the Committee who is a representative of his/her body shall be rotated on an annual basis within its membership. Provided, any representative may waive his/her right to be a member of the Committee in any rotation without waiving his/her right to be a member of the Committeein any future rotation. Any member of the CouncilCommitteemay in writing appoint a designee.A designee from a representative body shall be from the representative body.All designees shall be speaking representatives on behalf of the member and avoting member onany matter coming before the CouncilCommittee. There is also created a Spokane Regional Law and Justice Administrative Committee, herein after referred to as the “Administrative Committee”,which will have up to a maximum of seven (7) members. The Administrative Committee shall be members of the Council and have the following composition: a.The two (2) members of the Spokane County Board of County Commissioner; b.City of Spokane Mayor; c.City of Spokane Council Member to be selected by the Spokane City Council; d.A representative of Spokane County Superior Court; and e.Up to two (2) additional members. The role of the Administrative Committee is to (1) receive the process, policy, administrative and budgetary recommendations of the Council, (2) analyze, authorize and implement resource allocationsin alignment with those prioritiesand (3) advocate for priority reforms recommended by the Council members and the community at large. Section 2:PURPOSE The purpose of the CouncilCommitteeis to provide a permanent on-going forum and structure to coordinate and enhance the administration of justicein Spokane County. Page 5of 8 Section 3:TERMS Theterms of the members of the Council andAdministrativeCommitteewho are not designated by a selecting authority,electedshall run as long as such individual retains the prerequisite elected position. The terms of members of the Counciland AdministrativeCommitteewho are designated by a selecting authorityshallbe rotated as provided for in Section 1 above.renewed by the selecting authority every four (4)years.Provided, further, the terms of the (4) four at-large members, except as provided for herein after, shall be (4) four years and staggered so that a new at-large member is appointed every year. The initial terms of at-large members shall be as follows; at-large member Position No.1, (4) four years terminating in October 2019; at-large member Position No. 2, (4) four years terminating in October 2020; at large member Position No. 3, (4) four years terminating October 2021, at large member Position No.4, (5) years terminating in October 2022. The clerk of the Board of County Commissioners shall by lot determine which individual appointed to fill member Position No. 3 and member Position No. 4. After 2022, the member appointed to fill at-large member Position No. 4, shall have a (4) four-year term.The selecting authority has the ability to designate a different representative provided that the underlying qualifications for the position are satisfied.Members may be removed by their selectingauthority. Except in the case of removal, each member shall continue to serve until a successor has been appointed. Any non-elected official member shall have a four-year term. Section4:COMPENSATION Members of the Council and AdministrativeCommitteeshall serve without compensation and/or per diem of any kind or nature whatsoever, including compensation for travel to and from the usual places of business to the place of a regular or special meeting of the CouncilorAdministrative Committee. Section 5:MEETINGS, RULES AND REGULATIONS The Council and AdministrativeCommitteeshall hold meetings as deemed necessary by the Chairperson or a majority of the CouncilorAdministrativeCommittee.respectively.Provided, however, the Committee shall meet at a minimum twice annually.The Council and Administrative Committeemay adopt rules and regulations governing the transaction of business.The Council and AdministrativeCommitteeshall keep public records of all actions as may be required by applicablelaws.All meetingsof the Council and Administrative Committeeshall be open and accessible to the public as provided by law. A quorum for doing business by the Council or AdministrativeCommitteeshall be established by the presence of at least 50% of the members or their authorized designeeseither in person or telephonically. Section 6:OFFICERS The chairpersonof the CouncilCommitteeshall be selectedaSpokane County Board of County Commissioner memberas designatedby the Board of County CommissionersCommitteeon an Page 6of 8 annual basis in Januaryby a simple majority vote of a quorum of voting members. The vice chairperson of the CouncilCommitteeshall be selected by the CouncilCommitteeon an annual basis in January by a simple majority vote of theaquorum of the voting members. The chairperson and vice chairperson of the Administrative Committee shall be selected by the Administrative Committee on an annual basis in January by a simple majority vote of a quorum of the voting members. The chairperson(s)shall preside over all meetings, and in the absence of such chairperson, the vice-chairpersonshall preside. Section 7:MISSION STATEMENT The mission of the CouncilCommitteeisto create and sustain a cost-effective regional criminal justice system that builds a healthyand strong community by fostering the best possible outcomes for thecommunitywhich are consistent with the law and community objectives of public safety, accountability, just punishment,appropriatetreatment and increase public awareness so as to, reducingreducerecidivism and increasingincreasesystem collaboration. Section8:POWERS AND DUTIES The CouncilCommittee, in conjunction with carrying out the above mission statement, shall make recommendations to the appropriate elected officials and the Administrative Committeeon the following issues: (a)Maximizing local resources including personnel and facilities, reducing duplication of services, and sharing resources between local and state government in order to accomplish local efficiencies without diminishing effectiveness; (b)Reviewing data and reports with a goal of ensuring that departments are reducing recidivism, increasing program completion, engaged in more efficient practices, generating cost savings, expediting cases when appropriate, and contributing to a reduction in crime; (c)Jail management; (d)Mechanisms for communication of information about offenders, including the feasibility of shared access to databases; and (e)Partnerships between the department and local community policing and supervision programs to facilitate supervision of offenders under the respective jurisdictions of each and timely respondingto an offender’s failure to comply with the terms of supervision.; and (f)Developing a Local Law and Justice Plan for Spokane County. The Council shall design the elements and scope of the Plan, subject to final approval by theSpokane County Board of County Commissioners. The general intent of the Plan shall include seeking means to maximize local resources, reduce duplication of services, and share resources between local and state government. Page 7of 8 The CouncilBoard of County Commissionerson request of theCommittee,or on its own action may establish temporary advisorywork groups and/orsubcommittees to assist the Committeein carrying out its powers and dutiesas outlined above. The CouncilCommitteehas no authority to appropriate / expend any moneys or execute any agreements. STAFF SUPPORT Section9: Spokane County shall provide staff support for the Council and AdministrativeCommittee as is deemed necessary. Page 8of 8 Recommendation from Strategic Planning Committee to the Spokane Regional Law and Justice Council regarding organizational structure and membership of the SRLJC. On April 14, 2021, the SRLJC by affirmative motion tasked the Strategic Planning Committee with analyzing Prosecutor Haskell’s proposed resolution to change the assigned tasks and membership of the SRLJC. On April 28, 2021, Strategic Planning held a special meeting to discussthis issue. As a result of that meeting, a request was made for the Chair and Vice-Chair to draft a recommendation for considerationby Strategic Planning onMay 10, 2021, which is anticipated to be ready for Strategic Planning to make a recommendation to give the SRLJC at the May 12, 2021 meeting. Followingdiscussion (seeminutes of April 28, 2021 meeting, attached), Strategic Planning recommended that a two-entityapproach be utilized: The first is a committee, required by RCW 72.09.300, which could function as proposed by Prosecutor Haskell in his resolution, which conforms closely tothe requirements of thestatute.A recommendation was made to amend the draft resolution so consideration of data is included again. Form asecond entity as a councilpursuant to RCW 39.34.180, the Interlocal Cooperation Act, the terms of which would be negotiated by the regional jurisdictional and criminal justice partners. The Criminal Justice Commission (CJC) recommended considering the application of the National Institute for Corrections recommendations on Criminal Justice CoordinatingCommittees, which identifies interlocal agreement as the preferred approach. If a second entityis organized by interlocal agreement, Strategic Planning suggested several concepts that should be considered for inclusion in the new council: 1.Robust community participation at every level is crucial, including voting privilegesin committees and at the main council; 2.In order to get the council moving quickly, draft an initial interlocal agreement that forms the council largely along the current structural frameworkof the SRLJC, which can then be modified later if necessary. Forming this new council should occur prior to dissolving the SRLJC as it exists today; 3.Use astrong committee structure where the bulk ofthe work and recommendations are done, which shouldrefocus the work effort and should help make the entity more productive; 4. Determine if the parties to the interlocal can and will grant at least some authority to make the council more than just a recommending body; 5. Determine if the council should have some separate budget (will depend on duties); 6. Should have an administrative or executive committee to set agendas as a group;and 7.In determining voting membership, focus on electedofficialsand system professionals who have knowledge/desire/ability to impact the system.