HomeMy WebLinkAbout08/05/2019 12 Use of City's Annual Retail Sales Tax, per Substitute House Bill 1406, on Affordable Housing Opportunities to\'4\lyy tbxk ik 1
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BUSINESS OF THE CITY COUNCIL
YAKIMA, WASHINGTON
AGENDA STATEMENT
Item No. 12.
For Meeting of:August 5, 2019
ITEM TITLE: Resolution expressing the City Council's intent to adopt legislation
authorizing the imposition of the maximum capacity available from
the City's annual taxable retail sales and use tax, as provided for in
Substitute House Bill 1406 effective July 28, 2019, to be used for
the provision of affordable housing opportunities within the City
SUBMITTED BY: Jeff Cutter, City Attorney
SUMMARY EXPLANATION:
The 66th State legislature passed Substitute House Bill 1406 on April 28, 2019. The Governor
signed the Bill on May 9, 2019 and the Bill will be effective on July 28, 2019. The Bill provides an
opportunity for participating cities and counties to retain up to a maximum amount of 0.0146% of
the retail sales and use tax otherwise collected by and paid to the State to be used for purposes
supporting the provision of affordable housing in the participating jurisdiction. The actual amount
that is permitted to be imposed by each jurisdiction is determined by the application of several
factors established by the terms set forth in the Bill.
In order for the City of Yakima to be eligible to authorize, fix and impose this tax for the benefit of
the City's affordable housing efforts the City Council must 1) pass a resolution within six months
of the effective date of the legislation indicating its intent to impose the maximum capacity of the
tax and 2) must pass legislation actually imposing the maximum capacity of the tax within one year
of the effective date of the legislation. The amount of the sales and use tax retained by the City in
accordance with SHB 1406 may be used by the City for acquiring, rehabilitating or constructing
affordable housing, including new units of affordable housing within existing structures or facilities
providing supportive housing services, or for providing rental assistance to tenants. The
affordable housing assistance is available to persons whose income is at or below sixty percent
of the City's median income level.
ITEM BUDGETED:
STRATEGIC PRIORITY:
2
APPROVED FOR City Manager
SUBMITTAL:
STAFF RECOMMENDATION:
Adopt resolution
BOARD/COMMITTEE RECOMMENDATION:
ATTACHMENTS:
Description Upload Date Type
El Sales Tax Retention-Affordable Housing per SHB 1406 7,19,2019 Resolution
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RESOLUTION NO. R-2019-
A RESOLUTION expressing the City Council's intent to adopt legislation authorizing the
imposition of the maximum capacity available from the City's annual taxable
retail sales and use tax, as provided for in Substitute House Bill 1406
effective July 28, 2019, to be used for the provision of affordable housing
opportunities within the City.
WHEREAS, The residents of the City of Yakima are subject to a retail sales and use tax
of 8.2%for retail goods and services purchased within the City; and
WHEREAS, the City of Yakima does not impose any of the "qualifying local taxes"
identified in Section 1(1)(e) of Substitute House Bill 1406; and
WHEREAS, Substitute House Bill 1406 provides the opportunity to a city to legislatively
authorize, fix and impose a sales and use tax in the maximum amount of up to 0.0146% of the
taxable retail sales occurring in the City; the maximum amount available to the City is
determined by a number of factors that include whether the City is within a County that also
elects to impose a similar tax; and
WHEREAS, the City has been advised by Yakima County staff that Yakima County is
uncertain whether it would choose to impose the tax opportunity within the County; and
WHEREAS, the tax imposed under Substitute House Bill 1406 must be deducted from
the amount of tax otherwise required to be collected or paid to the Department of Revenue, as
authorized under RCW 82.08 and RCW 82.12, and retained by the City; and
WHEREAS, the tax revenue that the City is authorized to retain under the operation of
Substitute House Bill 1406 may only be used for acquiring, rehabilitating or constructing
affordable housing, including new units of affordable housing within existing structures or
facilities providing supportive housing services, or for providing rental assistance to tenants; and
WHEREAS, the housing and services provided pursuant to the use of the taxes retained
under the operation of Substitute House Bill 1406 may only be provided to persons with
incomes at or below 60% of the median income of the City; and
WHEREAS, the Yakima City Council is keenly aware of the need in the community for
opportunities to provide affordable housing assistance to the residents of the City who are
experiencing low income, as well as the fact that there is a shortage of good quality affordable
housing within the community; and
WHEREAS, the City Council finds that it is in the best interests of the City to take
advantage of this opportunity to retain the maximum amount of the sales and use tax revenue
collected within the City to enhance the affordable housing opportunities to low income
residents of the City, Now, Therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA:
The City of Yakima shall initiate legislation to authorize the opportunity provided by
Substitute House Bill 1406 to retain the maximum capacity of up to 0.0146% of the retail sales
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and use tax collected within the City from the Department of Revenue for the purposes of
acquiring, rehabilitating or constructing affordable housing, including new units of affordable
housing within existing structures or facilities providing supportive housing services, or for
providing rental assistance to tenants, only for the benefit of persons with incomes at or below
60% of the median income of the City; the legislation necessary to authorize the retention of
these revenues shall be adopted no later than one year after July 28, 2019.
ADOPTED BY THE CITY COUNCIL this 5'h day of August, 2019.
ATTEST: Kathy Coffey, Mayor
Sonya Clear Tee