Affordable housing providers call for code changes in Olympia to address development challenges


Representatives from local nonprofits South Puget Sound Habitat for Humanity and Homes First brought concerns over barriers they face when developing new affordable housing in Olympia, claiming that the city's codes and permitting requirements are not helping in solving the affordable housing crisis and homelessness.

At Tuesday's city council meeting, Elizabeth Walker, South Puget Sound Habitat for Humanity chief executive officer, said the organization has two projects in the pipeline but they are facing challenges in advancing these developments.

In March 2023, the city council approved the transfer of 10 acres to South Puget Sound Habitat for Humanity to construct more than 100 affordable low-income housing at 3900 Boulevard Road SE.

The nonprofit organization agreed to create at least 100 affordable units for people making 30-80% of the area median income.

For one of the projects, Walker mentioned that they have another opportunity in Olympia with private donors who would like to give them land for a housing project.

" We have been facing code and permitting challenges that have major implications for the feasibility of projects and also for sustainability overall of continuing to be able to provide affordable homeownership," Walker said.

Walker added that they are facing around $118,000 per unit in off-site and on-site improvement requirements, which is close to what they sell their houses for.

"It's not a tenable situation for us, and it's probably going to torpedo the project," Walker added. "We're going to have to say no to the donor because of these requirements."

"We all know that housing shortages are at a crisis level. We know we need to be doing something about it," Walker said, adding "The reality right now is that code and permitting requirements are not helping the solution."

Walker urged the city council to consider an alternate code for affordable housing providers. She said the code might resemble the emergency declaration for homelessness.

"It might look similar to a housing overlay zone that we see successful in other communities. An alternate code would provide a path for your staff to be able to help us meet our goals," Walker said.

Homes First CEO Trudy Soucoup asks Olympia City Council to consider looking at other cities' ideas of adopting code changes and sales tax exemptions for affordable housing providers.
Homes First CEO Trudy Soucoup asks Olympia City Council to consider looking at other cities' ideas of adopting code changes and sales tax exemptions …

Homes First CEO Trudy Soucoup echoed the call for changes: "You've asked us to do affordable housing. We are trying to do it. We feel like there are a lot of barriers being put up in our way."

According to Soucoup, other cities like Portland have changed their codes, which reduces costs for the providers and increases developments.

She added that the cities of Tacoma and Seattle have changed their sales tax for affordable housing providers.

Soucoup asked the councilmembers to copy these ideas from other cities to make it easier for them to provide more housing. "Together, we can create a city where everyone has the opportunity to live in safe, affordable housing. I urged the city council to consider these kinds of proposals not just as a policy change, but as a commitment to be well-being and future of Olympia residents."

Olympia Assistant City Manager Rich Hoey said the city staff would meet with Habitat to discuss the specific project challenges and see if there is an alternative path within existing regulations.

Councilmembers expressed interest in having further conversations about the suggestions on code changes and sales tax exemption.

Councilmember Clark Gilman expressed interest in learning more about sales tax exemptions used in other cities, as mentioned by Walker and Soucoup.

The councilmember drew a comparison to how groceries are not taxed in Washington because they are considered a basic need. He wondered if housing could also be considered a basic human need, making a sales tax exemption for affordable housing providers an interesting idea to consider further.

He was also intrigued by the concept of an "alternate code" or "housing overlay zone" used successfully in other communities, which could provide a path for staff to help affordable housing developers meet their goals.

Councilmember Jim Cooper pointed out that cities like Tacoma that have implemented sales tax changes for housing may have different powers as charter cities.

As a non-charter city, Cooper said, Olympia would likely need explicit authorization from the state to make reductions to sales tax, so further exploration is needed. But expressed interest in learning more about the idea.

"There have been a few things where we already do exemptions for affordable housing. If there is something that is missing from that equation, let us chat about it," Madrone told the nonprofit leaders.


8 comments on this item Please log in to comment by clicking here

  • MartyKenney

    I agree 1000% that the city code needs amending for affordable housing development. Rules put in place many years ago have helped to shape Olympia into a lovely city, but they have become outdated, and we must demand that the city staff join the team to create a new era of development. Low cost development is being proposed and continues to be abandoned because of their rules… the writing is on the wall!

    Fees and design requirements should be a tool to guiding the development that accomplished the goals of the people, and the goals of the people are continuing to say, let us build affordable housing. Walker John and his cronies that are not developing affordable housing and don’t deserve to avoid design fees. However, small scale builders, and historically low income designers that are doing what they can with their small budgets, should be encouraged to design with minimal cost barriers if they can seriously prove that their units will be affordable. This begs the question, What is affordable? $800/month rent, or $300,000 to own would be a great starting point from my perspective.

    I hope this open minded council can crack the code and get the city staff to make the changes necessary for our city to finally have affordable housing. Enough is enough!

    Thursday, June 20 Report this

  • Yeti1981

    It is a good thing that more are understanding the obstacles local jurisdictions have consistently put in front of the homebuilders and their objectives. We need ALL types of housing for ALL levels of income. That's not my opinion. That's directly from the Department of Commerce's housing action tool. So, we need to get creative at every level.

    Thursday, June 20 Report this

  • Ribbieb

    What are the code changes they want?

    Thursday, June 20 Report this

  • QueenBee01

    Councilman Clark Gilman asked if housing could be a basic human need, and my response is: have you ever lived on the streets of Olympia with three children for six weeks, and this was in 1992. No restrooms were available, food is scarce especially with no way to prepare it, water unless you buy it, shelter if you can find it is a luxury, and you cannot get housing or a job without an address. If you think housing is not a basic human need or right, take you and your family, and live on the streets for even a week. And that is without using your credit cards or cash to help you get by. Living on the streets in 1992 was extremely scary, but now, I do not know how people do it.

    It would be terrifying now, and yet people are doing it, and they are getting ridiculed, ignored, and chastised for it. Granted, some people are just using the system, but that is fairly rare. Others have mental health problems, along with drug and alcohol abuse issues. For the majority of people living on the streets, it is not their fault. Sometimes, just one simple thing can send a person or a family spiraling into homelessness: illness, medical costs, loss of a job, a car that won't work, and unexpected bill(s) to name a few. It does not take much, especially with the cost of housing, food, medical costs, car repair, energy bills to tip a person's ability to pay their bills. Also, challenging is for those people that are senior citizens or disabled, and with limited income to start with.

    And yes, Councilman Gilman, housing is a very basic need. Housing is absolutely critical if people are able to be residents in Olympia or anywhere else. I also urge you to actually look at the price of housing and how much it takes to keep that housing. A lot of landlords are now wanting a potential renter to earn three times the amount of rent, plus utilities, plus deposit, plus application fees, and any pet fees if they have pets. It is insane to think that the majority of people will have that kind of money to secure a rental. Something needs to change and it needs to change now!

    Thursday, June 20 Report this

  • JMSimpson

    Well put Queen Bee01!

    Housing is a basic human need, and this city council has the opportunity to act in a way to meet this need in addressing the growing epidemic of homelessness in the area if it has the will and determination to do so. We shall see.

    JM Simpson

    Thursday, June 20 Report this

  • JW

    You are truly delusional if you think the majority of the transients out there are on the streets because of a lost job or medical bills.

    That being said, I'm for anything that lifts the onerous level of restrictions the government has placed on development.

    Thursday, June 20 Report this

  • BobJacobs

    Oh my!

    So many generalities and so many hidden expenses.

    What exactly are the city requirements that these advocates seek to be exempted from? Let's look at each one. Why is it there? If it is not justified, then let's get rid of it. But if it is justified, what happens if some people are exempted? Who pays for the public benefits lost?

    And why are we hiding so many costs from public view? The annual budget is supposed to give us the full picture of city expenditures. But these exemptions are hidden from annual review. In public finance they're called "tax expenditures" because they have the same bottom-line effect as regular expenditures but are achieved via special tax provisions. If we want to subsidize these organizations, then we should appropriate the money and put it in the annual budget where it gets regular scrutiny.

    In 50+ years of watching public finances I have never seen an accounting of these tax expenditures. That should concern us.

    Bob Jacobs

    Friday, June 21 Report this

  • Yeti1981

    @JMSimpson - *shelter is a human need. You can't demand that someone build you a house without paying them for their efforts. And you can't demand that someone take care of all the maintenance and any needed upgrades to that house for free either. Cities don't build houses.

    Friday, June 21 Report this