Washougal, VHA sign agreement for rental subsidy program

The Vancouver Housing Authority (VHA) and the city of Washougal have finalized an interlocal agreement that will create a rental subsidy program for a low-income housing tax credit (LIHTC) property in Washougal.

The agreement, approved by the Washougal City Council Monday, Nov. 6, acknowledges that “housing affordability has become a significant problem in both Clark County and the City of Washougal” and that “funding to support affordable housing through rental assistance is important in order to provide an array of housing opportunities for City residents.”

The VHA’s “rent buy-down” program will provide financial assistance to residents at Rockwood Terrace Apartments who earn less than 30% of the area’s median income, according to VHA Executive Director Roy Johnson.

“Because it’s a LIHTC property, the maximum income of households is 60%, but it has a number of households below 30%, and they’re really stretched to make their payments,” he said. “That’s why we focused on that group with our limited resources. When we first started to talk with the City about this and decided to work with LIHTC sites, we reached out to two others in Washougal and did not get a response, so we just focused on Rockwood at that point.”

The VHA developed the program in 2021 and launched it in Vancouver and Battle Ground before entering into talks with Washougal officials, Johnson said.

“It provides some rent subsidy, but it’s not to the level of what a Section 8 voucher would be,” he added. “Because of funding constraints, we wanted to look at ways that we could still assist some households but provide a lower per-household amount just so we could try to help more people since we knew we couldn’t issue a lot of vouchers right now.”

In 2020, the city of Washougal opted into Washington state’s Encouraging Investments in Affordable and Supportive Housing Act, which allows jurisdictions to collect state-shared local taxes to be used for investments in affordable and supportive housing.

The bill stipulates that jurisdictions must use the funds for the acquisition, rehabilitation or construction of existing affordable housing, the operation and maintenance of new affordable housing, or the provision of rental assistance to tenants, and that the program will expire 20 years after its implementation.

Since then, the City has received 0.0073% of collected sales tax for local retail sales — $14,454 per year — that it plans to invest into the program on an annual basis.

“We approached the VHA to say, ‘We’re a small staff. We don’t have the expertise, nor can we afford to administer a program (on our own). Would you administer a program for us?’” City Manager David Scott said during a Council workshop session on Monday, Nov. 6. “They shaped a program, and (we’re) basically plugging into something they already do. We just don’t have the resources. Our sales tax credits are very modest, but one of the Council’s goals was to do what we can around this issue of reducing homelessness, so we’re super grateful (for the VHA’s assistance).”

The agreement states that the City funds will provide approximately 18%of the annual cost of the program and that the VHA will provide the remainder of the funding — $60,000 per year, according to Johnson — through Move to Work funding provided by the United States Department of Housing and Urban Development (HUD).

“What’s really unique about Washougal is that this is our only interlocal agreement (with a city) that has come to us and said that they wanted to use the local sales tax that they received back for rental subsidy,” he added. “It’s a pretty great thing to do, and hopefully we’ll see more of that going on throughout the county.”

The VHA program will provide eligible Rockwood Terrace residents with $259 per month, most likely starting in January 2024, according to Johnson.

“What’s unique with this particular site is that those rents are set at the 60% rent level, so we said for the group in the very low-income range, the best we could do is buy it down to the 50% rent range,” he added. “So for those households, the additional subsidy from this program would be $259 a month, but each year, those rent levels get changed, so it’ll adjust every year.”

Several Rockwood Terrace residents publicly expressed their frustration about large rent hikes in late 2022, saying they couldn’t afford such increases with their limited incomes.

“(This program) makes sure that they’re not spending such a large percentage of their income towards rent just to stay housed,” Johnson said. “Also, (it helps) to keep them housed. It’s not the full subsidy that normally we would hope to give, but it still may be enough that it helps them stay in their apartments and keep up with their rent. That’s definitely what we want to see, less hardship. This could make the difference (for them).”

The VHA, the largest provider of subsidized housing and rental assistance in Clark County, is governed by a six-member board of commissioners appointed by the mayor of Vancouver. The agency works with government entities and other partners to provide affordable housing and has helped create more than 1,600 unsubsidized apartments in Clark County for people earning less than 80% of the area’s median income.

“VHA is a move-to-work agency, so we’re able to do more flexible programs with that (HUD) money,” Johnson said. “Other housing authorities wouldn’t be able to (implement this kind of rental assistance program) unless they were move-to-work. We’re in a unique position to do these kinds of programs, and fortunately, we’re in Clark County, so we’re able to get good collaborators.”

The VHA is still planning to move ahead with its plans to construct workforce-housing complexes — typically defined as housing that is affordable for people earning 60% to 120% of an area’s median income — on the two parcels of land that it owns in downtown Washougal.

City leaders questioned the VHA’s commitment to the project earlier this year after they enacted a series of changes to the City’s parking requirements for residential construction within its Town Center.

Previously, the City required residences within its Town Center to provide a minimum of 0.5 parking stalls per unit. Now, the minimum requirements are one stall per studio unit; 1.5 stalls per one-bedroom unit two stalls per two-bedroom unit and above; and one stall per unit for senior housing.

“(The new parking regulations) do change (the project) because you have a higher cost per unit, and then you still have the operating expense that goes along with it,” he said. “(But) there’s a way forward. (The changes) just mean that we’ll have to layer on additional public funding from our sources — (primarily) the Washington State Housing Finance Commission and the Washington Department of Commerce for the Housing Trust Fund, as well as our own bonds that we issue.”

Johnson told the Washougal City Council in 2022 that he hoped that the VHA could have shovels in the ground by 2024 or 2025.

“We still own the parcel,” he told the Post-Record. “There were some changes that the City put in place about parking (after we) purchased (the property), but it is still on our to-do list to get some housing there. We may direct it towards a senior population or something, but we still hope to do it. A big part of it, too, is just getting in the queue with our projects, because we only are able to get so many projects funded per year through the different funding programs. It just falls into line of us having it planned, but not being able to do all of the projects we want to complete all in one year. They have to be spread out.”